A Critique of neo- Classical Community Indifference Curve
Subject Areas : Futurology
1 - ندارد
Keywords: Pareto Optimality, Community Indifference Curve, Marginal Rate of Substitution, Marginal Rate of Technical Sub, Marginal Rate of Transformatio, Homothetic Tastes,
Abstract :
Neo- classical economists think there exists a social consensus among Individuals of society about what to be produced. Moreover, in order to draw community indifference curves, neo-classical economists assume that aggregate demand is independent of income distribution and individuals have identical tastes. In this paper we discuss that aggregate demand is not Independent of income distribution and individuals have different tastes. In other words, individuals have non- homothetic and non- identical preferences. In this situation, indifference curves do not exist.
