Bearing the Burden of Reality: Strengthening the Bonds between Economic Philosophy, Theory, and Practice

This study fortifies the links between economic philosophy and theory and between theory and practice. Chapter I develops a modern definition of utilitarianism and determines that the current form of utilitarianism upholds characteristics of overriding objectives, equality, welfarism, consequentialism, aggregation, and maximization. By connecting the characteristics of utilitarianism developed in the first chapter, Chapter II composes a contemporary notion of welfare economics. This chapter constructs a utility function that depends on preference satisfaction of an individual and of other members in the community. From this concept of utility arises a social welfare function that interprets the economic conditions of a particular social group. Chapter III determines the problems that arise when welfare economists translate theory into reality. In assessing the problems of reality in terms of the six utilitarian characteristics, this chapter demonstrates that numerous practical and ethical issues arise because social values and basic human traits are extremely difficult to incorporate into a theoretical function. Finally, Chapter IV develops solutions for those problems in Chapter III. Economists agree that the need for reaching social decisions requires the formulation of a social welfare function, and the final chapter examines methods that allow for theory to serve as a more accurate basis for decision making. Acknowledgements: I would like to thank my adviser Professor Takeshi Amemiya for his unparalleled dedication throughout the research and writing process. Since Sophomore College in September 1999, he has consistently been an exceptional mentor. I would also like to acknowledge senior honors adviser Geoffrey Rothwell. I appreciate everything that I have learned from him over the past three years. Finally, I thank my parents Adele and Allen and my brother Jeff for their love and support.