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Enhancing welfare without a theory of welfare

Published online by Cambridge University Press:  14 October 2019

DANIEL M. HAUSMAN Open the ORCID record for DANIEL M. HAUSMAN [Opens in a new window]
DANIEL M. HAUSMAN*
Affiliation:
University of Wisconsin-Madison, Madison, WI, USA
*
*Correspondence to: University of Wisconsin-Madison, 600 N. Park Street, Madison, WI 53706, USA. Email: [email protected]
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Abstract

By identifying well-being with preference satisfaction, mainstream normative economists were able to leave the determination of which specific things make people better or worse off to the individuals themselves. The findings of behavioral economics undermine the possibility of deferring in this way to individual preference. One response to this challenge to welfare economics is to distinguish the true preferences of individuals from their manifest preferences and to take true preferences to guide policy. In The Community of Advantage, Robert Sugden criticizes this strategy and proposes that economists appraise policies, institutions and outcomes by the opportunities they provide rather than by their contributions to welfare. This paper criticizes Sugden's view and argues for a modest solution that makes cautious use of preferences as indicators of well-being.

Type
Article
Information
Behavioural Public Policy , Volume 6 , Issue 3 , July 2022 , pp. 342 - 357
Copyright
Copyright © Cambridge University Press 2019

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