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How cardinal utility entered economic analysis during the Ordinal RevolutionLength: 31 pages

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  • Ivan Moscati

    (Department of Economics, University of Insubria, Italy)

Abstract

The paper shows that cardinal utility entered economic analysis during the Ordinal Revolution initiated by Pareto and not, as many popular histories of utility theory assume, before it. Cardinal utility was the outcome of a discussion begun by Pareto about the capacity of ranking transitions among different combinations of goods. The discussion simmered away during the 1920s and early 1930s, underwent a decisive rise in temperature between 1934 and 1938, and continued with some final sparks until 1944. The paper illustrates the methodological and analytical issues and the measurement-theoretic problems, as well as the personal and institutional aspects that characterized this debate. Many eminent economists of the period contributed to it, with Samuelson in particular playing a pivotal role in defining and popularizing cardinal utility. Based on archival research in Samuelson’s papers at Duke University, the paper also addresses an issue of priority associated with the mathematical characterization of cardinal utility.

Suggested Citation

  • Ivan Moscati, 2012. "How cardinal utility entered economic analysis during the Ordinal RevolutionLength: 31 pages," Economics and Quantitative Methods qf1205, Department of Economics, University of Insubria.
    • Handle: RePEc:ins:quaeco:qf1205
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    File URL: https://www.eco.uninsubria.it/RePEc/pdf/QF2012_05.pdf
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    References listed on IDEAS

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    More about this item

    Keywords

    Cardinal utility; Ordinal Revolution; Utility analysis; Utility measurement; Samuelson JEL Classification: B13; B21; B40; D11;
    All these keywords.

    JEL classification:

    • B13 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - Neoclassical through 1925 (Austrian, Marshallian, Walrasian, Wicksellian)
    • B21 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Microeconomics
    • B40 - Schools of Economic Thought and Methodology - - Economic Methodology - - - General
    • D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory

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