Collective Choice and REQM Problems
|1.||Collective Rationality: In any given set of individual preferences, the social preferences are derivable from the individual preferences.|
|2.||Pareto Principle: If alternative A is preferred to alternative B by every single individual, then the social ordering ranks A above B.|
|3.||Independence of Irrelevant Alternatives: The social choices made from any environment depend only on the preferences of individuals with respect to the alternatives in that environment.|
|4.||Non-dictatorship: There is no individual whose preferences are automatically society's preferences, independent of the preferences of other individuals.2|
Arrow analyzed voting situations rigorously with these conditions in mind and found that, in general, no mechanism could be devised that consistently met them all. This is his famous "impossibility theorem."____________________
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Publication information: Book title: Environmental Quality and Residuals Management:Report of a Research Program on Economic, Technological, and Institutional Aspects. Contributors: Allen V. Kneese - Author, Blair T. Bower - Author. Publisher: Resources for the Future. Place of publication: Baltimore. Publication year: 1979. Page number: 168.
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