ABSTRACT
Although evolutionary economics still lacks a well-defined normative branch, economists have a clear understanding of what a normative branch of economics in general is supposed to consist of. The aim of this chapter is to survey relevant notions and technical terms for use in later chapters. This concerns such key notions as ‘utility’ or ‘welfare’. I start by introducing the relevant terminology (in section 2.1) to clarify how these terms are going to be used and continue by specifying what it means to build a ‘theory of welfare’ and discuss relevant requirements. Subsequent to this, I present the most prominent existing theories of welfare and their merits and disadvantages (in section 2.2) because these will be the starting point for building an evolutionary theory of welfare. This is followed by a short introduction to, and exposition of, traditional welfare economics (in section 2.3) and an assessment of the main problems of traditional welfare economics, with special emphasis on the preference stability assumption (section 2.4). The chapter ends with a summary of the lessons learned (section 2.5).
