There is a concept close to needs. Koopmans in his second essay refers to survivability: if in the equilibrium some people die of starvation, it cannot be efficient.
Also, Richard Stone got the Nobel in the mid-80s for incorporating a crude notion of needs into utility theory. >Jay Hanson wrote: >> ... If one removes equilibrium and Pareto where is the normative claim for >> market outcomes? In other words, assuming they did a fairly good job of it, >> why not have government simply give people basic biological needs (food, >> water, shelter, healthcare, etc.)?< > >I don't know that equilibrium is that central to normative claims for >the market. Pareto optimality also seems a poor basis for normative >claims, since it gives a small minority (of one) the veto power over >any changes. In any event, most economists use Pareto only to define >(static) "efficiency," which is only one metric for making normative >claims. Chicago schoolers claim that efficiency is their only >normative criterion, while others say that "equity" is important, too, >and can overrule efficiency. There are of course other normative >criteria available. > >A dynamic-disequilibrium approach of the sort I use says that Pareto >is irrelevant, even if equilibrium does play a role (as a benchmark >and/or center of gravity). Market changes regularly mean that some >people are made worse off at the same time others are made better off. > >But return to the 50,000 euro question: what normative justifications >are there for the market? First, free-market economists deny the >possibility that the government could do "a fairly good job." James >Buchanan and the Virginia "public choice" school argue that democracy >is inherently inefficient and that the government represents a >"special interest." Thus, government is a tool of last resort (i.e., >for national defense, defending private property rights, enforcing >contracts, etc.) > >Second, the so-called Austrian school doesn't care about Pareto and >equilibrium either. They see the market as providing (negative) >freedom and that's enough for them. > >By the way, mainstream economists do not have a concept of needs. (For >them, "needs" are simply intense subjective wants.) I have a paper in >the works that defines that concept: basic needs are costs of human >living, while if these costs are not paid, human health declines (on >the physical, mental, and/or social dimensions). >-- >Jim Devine / "Segui il tuo corso, e lascia dir le genti." (Go your own >way and let people talk.) -- Karl, paraphrasing Dante. >_______________________________________________ >pen-l mailing list >[email protected] >https://lists.csuchico.edu/mailman/listinfo/pen-l > > _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
