Farewell to Kenneth Arrow, a Gentle Genius of Economics - WSJ - 0 views
-
Is there a voting system that can be relied on to distill the will of a group of people? Arrow’s impossibility theorem regarding voting and combining preferences put him in the rarefied group of economists with theorems named after them.
-
Drawing upon mathematical logic, it shows that there is no possible voting scheme that can consistently and sensibly reflect the preferences of a set of individuals with diverse views
-
Any scheme that could ever be invented will be at risk of perverse outcomes, where, for example, the choice between options A and B is affected by the presence or absence of option C; or where a vote switch by one person toward option A makes it less likely to prevail.
- ...3 more annotations...
-
it also explained why committees have so much trouble coming to consistent conclusions and why, with an increasingly polarized electorate, democracy can become increasingly dysfunctional.
-
until Kenneth drew on the techniques of topology (that is, the study of geometric properties and spatial relations), no one had ever been able to establish precise conditions under which there would be prices that would clear all markets, or under which one could assume that the market outcome was optimal
-
in the early 1950s, he clarified the very specific conditions under which market outcomes were for the best and, of equal importance, the far more general conditions under which public interventions in markets had the potential to make things better.