This is another important book by the author, who is a very distinguished economist and econometrician. It proposes new concepts of individual welfare and of social welfare, which can be quantitatively measured by using econometric information that the author has provided. Of course, the proposed mathematical model has to make some strong, and inherently controversial, theoretical assumptions. But they may be a price worth paying for being able to use this remarkable analytical construction.
John C. Harsanyi, Haas School of Business, University of California, Berkeley; Nobel Laureate in Economics, 1994
Few economists have done more to link economic theory to econometrics than Dale Jorgenson. In this book, he relates the analysis of individual and social welfare to the econometric estimation of consumer behavior. The result is a wealth of both theoretical and empirical knowledge about the impact of policy reforms on inequality and poverty.
Mervyn King, Executive Director and Chief Economist, Bank of England
This powerful body of work bridges the gap between the common practice of policy inquiry and the nihilism of traditional social choice theory. To make normative policy recommendations possible, Jorgenson shows how to move beyond what Arrow proved was impossible. Aggregate welfare is more than defined and measured here; it is greatly enhanced.
William H. Hogan, Thornton Bradshaw Professor of Public Policy and Management, Kennedy School of Government, Harvard University