Consumer Choice and Welfare

Jeffrey James

Chapter 1 in Consumer Choice in the Third World, 1983, pp 4-27 from Palgrave Macmillan

Abstract: Abstract According to Herbert Simon, traditional economic analysis rests on two basic assumptions. The first is that the economic agent has a specific goal; for the producer it is to maximise profits and for the consumer to maximise utility. The second assumption is that the economic agent, producer or consumer, is ‘substantively rational’ — that is, his behaviour is ‘appropriate to the achievement of given goals within the limits imposed by given conditions and constraints’.1

Keywords: Utility Function; Consumer Choice; Efficiency Frontier; Traditional Theory; Individual Welfare (search for similar items in EconPapers)
Date: 1983
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-1-349-06109-9_2

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DOI: 10.1007/978-1-349-06109-9_2

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