A commonsense assessment of Arrow’s theorem

Guido Ortona ()

Journal of Heterodox Economics, 2016, vol. 3, issue 1, 54-62

Abstract: The usual, pessimistic interpretation of Arrow’s General Possibility Theorem (often “Impossibility” in textbooks) is excessive. The impossibility defined by Arrow occurs only in presence of a tie or of a cycle. These cases are rare or very rare, and their presence may be assessed ex post. If they occur it is necessary to resort to a second-best rule, but this two-stage procedure does not induce strategic behavior, nor impeaches the use of the Condorcet rule (in observance of the axioms) in all the others.The paper conclusions sustain that implementation of modern management systems to government’s public institutions should deal with a different behavior used to know at companies. In this respect, the paper high-lights different aspects between companies and public institutions behavior admitting similarities on organizational structure and internal procedures.

Keywords: Arrow’s Theorem; Social Choice; Condorcet Rule (search for similar items in EconPapers)
JEL-codes: C15 D71 (search for similar items in EconPapers)
Date: 2016
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Working Paper: A commonsense assessment of Arrow's theorem (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:vrs:joheec:v:3:y:2016:i:1:p:54-62:n:3

DOI: 10.1515/jheec-2016-0003

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