Kenneth Arrow

Kenneth Joseph Arrow ( born August 23, 1921 in New York City ) is an American economist. In 1972 he was awarded the Prize in Economic Sciences the Bank of Sweden in memory of Alfred Nobel with John Richard Hicks.

Life

Arrow is Professor Emeritus at Stanford University.

In 1986 he was awarded the John von Neumann Theory Prize.

Impossibility

1951 published Arrow named after him Arrow 's theorem in the context of his PhD thesis Social Choice and Individual Values. It shows that it is impossible to establish a set of rules by which one falls societal decisions on a number of reasonable criteria.

The impossibility theorem is at the beginning of the modern social choice theory, which deals with the possibilities, conditions and limits how collective decisions are to be based on individual preferences and values.

Arrow did not try in contrast to previous research, develop a substantiated decision process, but postulated certain criteria to be fulfilled by an acceptable and meaningful decision-making and trying to narrow down by this axiomatization the number of thoroughly into consideration process, to which then further investigations could focus.

Surprisingly, however, it turned out that even a few, meaningful and seemingly harmless conditions (such as the weak Pareto principle and the prohibition of an absolute dictatorship ) were not compatible with each other, so there was no such method - and so, of course, certainly not a procedures are imposed on the further requirements.

The researches were continued in this area, among others, Amartya Sen.

Endowed by the Swedish Riksbank Economic Price

The business award received Arrow for his analyzes of the possibility of economic equilibrium states as well as its introduction and successful application of complex mathematical methods in economics.

Environmental Economics

Since the 90s, Arrow working more in environmental economics, especially in collaboration with the Stockholm Beijer Institute of Ecological Economics. He was one of the authors of one of the most influential articles in this area, in 1995, published in Science, Economic Growth, Carrying Capacity, and the Environment. In this and other articles he represents a growth- critical position and attempts to develop alternative welfare indicators.

Publications (selection)

• Capital theory as an extension of the theory of value. Publishing business and finance, Cologne 1997, ISBN 3-87881-119-5.
• Where organizational ends. Management at the limit of what is possible. Gabler, Wiesbaden 1987, ISBN 3-409-96571-8.