ABSTRACT
Does a focus on the role of knowledge in the economy, and the theoretical coming to grips within economics that has only just started to occur, have an impact on the way in which economists and others should evaluate situations and developments that they encounter? My answer to this question is a resounding ‘yes!’. Reasons for this have become clear in the previous discussion. I would now like to develop some thoughts on what such a welfare economics might look like and what it might incorporate. As existing welfare economics, drawing on Pareto, is foremost a static perspective, and since this line of thinking is strongly influenced, directly and indirectly, by the work of Schumpeter, a Dynamic (Schumpeterian) Welfare Economics would emphasize the development of knowledge and its use in the economy. In this respect, in chapter seventeen of his Capitalism, Socialism and Democracy, Schumpeter (1943: 190, italics in original) has introduced some fundaments for a dynamic welfare economics. One passage is especially worth noting:
‘we shall call that system relatively more efficient which we see reason to expect would in the long run produce the larger stream of consumers’ goods per equal unit of time’.
