Preference, Value, Choice, and Welfare

This book is about preferences, principally as they figure in positive and normative economics.

Daniel M. Hausman (Author)

9781107015432, Cambridge University Press

Hardback, published 12 December 2011

168 pages, 20 b/w illus.
23.5 x 15.7 x 1.7 cm, 0.36 kg

'Daniel Hausman is one of the world's leading philosophers of economics. In this subtle and intelligent book he examines the concept of preference as used in microeconomics, game theory, and welfare economics. He uncovers the tensions between the different interpretations of preference in economics. He offers a resolution that challenges some of the discipline's most cherished dogma but is broadly consistent with its existing practice. It is difficult to imagine a more convincing philosophical defense of what most economists do.' Robert Sugden, University of East Anglia

This book is about preferences, principally as they figure in economics. It also explores their uses in everyday language and action, how they are understood in psychology and how they figure in philosophical reflection on action and morality. The book clarifies and for the most part defends the way in which economists invoke preferences to explain, predict and assess behavior and outcomes. Hausman argues, however, that the predictions and explanations economists offer rely on theories of preference formation that are in need of further development, and he criticizes attempts to define welfare in terms of preferences and to define preferences in terms of choices or self-interest. The analysis clarifies the relations between rational choice theory and philosophical accounts of human action. The book also assembles the materials out of which models of preference formation and modification can be constructed, and it comments on how reason and emotion shape preferences.

Preface
1. Introduction
Part I. Preferences in Positive Economics: 2. Preference axioms and their implications
3. Revealed preference theory
4. Preferences, decision theory, and consequentialism
5. Game theory and consequentialism
6. Constraints and counterpreferential choice
Part II. Preferences, Welfare, and Normative Economics: 7. Preference satisfaction and welfare
8. Preferences in welfare economics
Part III. Psychology, Rational Evaluation, and Preference Formation: 9. The psychology of choice
10. Constructing preferences
11. Conclusions.

Subject Areas: Political economy [KCP], Economic theory & philosophy [KCA], Social & political philosophy [HPS]