The Economics of Welfare

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  • Edition: Reprint
  • Format: Paperback
  • Copyright: 2013-12-06
  • Publisher: Palgrave Macmillan

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In The Economics of Welfare, originally published in 1920, Pigou reconceptualized economics as a science of economic welfare, in the course of which he developed the first systematic theory of market failures. Employing Alfred Marshall's theoretical framework and the utilitarian logic of Henry Sidgwick, he argued that the Smithian 'system of natural liberty' can fail to maximise economic welfare in three crucial spheres. Economic transactions grounded in the free play of self-interest may achieve a suboptimal allocation of resources by producing spillovers; they may maldistribute the national income, damaging much of the population; and they may generate business cycles, causing unemployment as well as income and consumption instabilities. In his analysis of how to repair these failures, Pigou made an elaborate, carefully reasoned case that interventions in otherwise unfettered markets may be in order.

This reissued classic includes a new introduction by Nahid Aslanbeigui and Guy Oakes, who offer fresh ideas on The Economics of Welfare as a treatise that cannot be reduced to a programmatic collection of taxes and subsidies designed to maximise economic welfare. They also spell out the implications of Pigou's thought for contemporary economics.

Author Biography

Arthur C. Pigou (1877-1959) was a British Economist and teacher at the school of economics, University of Cambridge, UK. Often remembered as Alfred Marshall's successor, Pigou's work famously explored a number of key areas in economics, and his input to the study of welfare economics has continued to inspire the works of economists around the world.

Table of Contents

1. Welfare and Economic Welfare
2. Desires and Satisfactions
3. The National Dividend
4. What is Meant by Capital Intact
5. Changes in Size of the National Dividend
6. The Measurement of Changes in the Size of the National Dividend
7. Economic Welfare and Changes in the Size of the National Dividend
8. Economic Welfare and Changes in the Distribution of the National Dividend
9. Reactions Through the Numbers of the Population
10. The National Dividend and the Quality of the People
11. The Method of Discussion to be Followed
12. Introductory
13. The Definition of Marginal Social and Private Net Products
14. The Values of Marginal Social Net Products and the Size of the National Dividend
15. Rates of Return and the Values of Marginal Private Net Products
16. The Effects of Eliminating Obstacles to Movement
17. Hindrances to Equality of Returns due to Imperfect Knowledge
18. Hindrances to Equality of Returns due to Imperfect Divisibility of the Units in Terms of which Transactions are Conducted
19. Hindrances to Equality of Returns due to Relative Variations of Demand for Productive Resources in Different Occupations and Places
20. Divergence between Marginal Social Net Product and Marginal Private Net Product
21. Marginal Private and Social Net Products I Relation to Industrial Forms
22. Increasing and Decreasing Supply Price
23. State Regulation of Competitive Prices
24. State Regulation of Supplies
25. The Conditions of Monopolisation
26. Monopolistic Competition
27. Simple Monopoly
28. Discriminating Monopoly
29. The Special Problem of Railway Rates
30. Purchasers' Associations
31. Intervention by Public Authorities
32. Public Control of Monopoly
33. Public Operation of Industries
34. Industrial Peace
35. The Classification of Industrial Differences
36. Voluntary Arrangements for Conciliation and Arbitration
37. Mediation
38. Coercive Intervention
39. An Analytical View of Industrial Peace
40. Hours of Labour
41. The Methods of Industrial Remuneration
42. The Distribution of Labour Among Occupations and Places
43. Employment Exchanges
44. Unemployment versus Short Time
45. The Practicability of Interference to Raise Wages
46. Methods of Engaging Labour
47. Interference to Raise Wages in Places and Occupations where they are Unfair
48. Fair Wages Inside Particular Industries
49. Fairness as a Variable Relation
50. Interference to Raise Wages in Places and Occupations where they are already Fair
51. Wage Rates and Capacity
52. A National Minimum Time-Wage
53. Fixed and Fluctuating Wage Rates
54. The General Problem of Disharmony
55. Pareto's Law
56. The Supply of Capital and Labour
57. Inventions and Improvements
58. The Manipulation of Wages
59. Rationing
60. Subsidies to Wages
61. Direct Transferences from the Relatively Rich to the Relatively Poor
62. The Effect on the National Dividend of the Expectation of Transferences from the Relatively Rich
63. The Effect on the National Dividend of the Expectation of Transferences to the Poor
64. Bounties on Things Purchased by the Poor
65. The Effect on the National Dividend of the Fact of Transferences from the Relatively Rich to the Poor
66. A National Minimum Standard of Real Income
1. Uncertainty-Bearing as a Factor of Production
2. The Measurement of Elasticities of Demand
3. A Mathematical and Diagrammatic Treatment of Certain Problems of Competition and Monopoly

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