ABSTRACT
Surprisingly to some, economists see beyond money in their calculations of efficiency. Hikers, chocolate lovers, and kissers don’t go on hiking, eating, or kissing forever, but the costs and benefits they weigh as they decide when to stop may have little to do with money. While soaking up the joys of acceptance and affection, kissers may also be thinking about the increasing likelihood of a roommate entering the dorm room, about their own fear of commitment, about not appearing too eager, or about the large and growing opportunity cost of not being able to spend the time studying environmental economics. Of course, they may also get
caught up in the moment and neglect some of the costs. (That’s a problem in environmental economics too!) Typical economic models of efficiency seek to maximize utility-an abstract measure of happiness-or a collection of everyone's utility called social welfare, and not just dollars. These models can account for the importance of joy, sorrow, love, guilt, spite, disease, free time, and anything else of interest or ill favor. In fact, to omit any significant cost or benefit, monetary or otherwise, is to jeopardize the integrity of the models described in this chapter.
