ABSTRACT
This chapter discusses a proposal for the measurement of utility by probabilistic assessment of alternative risky prospects. John Harsanyi would argue that John von Neumann-Oskar Morgenstern utility is relevant to welfare economics, but on grounds that would have little influence for a generation. J. de V. Graaff feasibility frontier takes the inefficiencies implied by feasible policies into account and so is generally the utility-possibility frontier. A. C. Pigou theory, founded as it is on comparisons of incremental utility, is undercut by the Paretian critique of utility theory. Cardinal utility would continue to play a part in some welfare economic reasoning, but it would not be the cardinal utility of Pigou. However, Pigou’s position is that the burden of proof is on those who assert that considerations of non-economic welfare offset an argument from economic welfare. The influence of game theory on welfare economics more generally has seemed to be slight.
