The influence of hedonism on the formation of economic theory

Abstract

The prime objective of this thesis is to show that contrary to the common belief of historians of economic thought, hedonism has played a central and a continuous role in the development of economic theory. In the process of showing this, the thesis starts with a brief examination of the origins of hedonistic ideas in the works of ancient Greeks. The next chapter Is concerned with the reappearance (after a long break of several centuries) of the basic hedonistic ideas mainly In the thought of Gassendi, Helvetius and Hobbes, and their subsequent introduction to the field of economics with the work of Bentham, Mill, Senior and Cairnes. The main elements of hedonism (although somewhat modified) were also observed in the economic thought of leading marginalist theorists, the subject matter of the fourth chapter, With the marginalist school, hedonistically based terms became central to economic theory and generally economic theory was characterized by an explicit hedonistic orientation. The fifth chapter discusses the attempts to downplay hedonism as found in the work of Wicksteed, Pareto and Fisher. The reasons for these attempts were the heterodox criticism and the increasing influence of positivist scientific philosophies. The discussion supports the view that in essence hedonism did not disappear but was pushed into the background. The sixth chapter assesses the modern attempts towards a neutral economic science without psychological or philosophical connotations. The works of Robbins, Hicks, Samuelson as well as the current developments are examined. As a further indication of the hedonistic influence on economic theory, chapter seven deals with a discussion of alternative economic approaches which stem from non-hedonistic paradigms. Adam Smith, Marx and Keynes are mentioned as examples of non-hedonistically oriented economists, and lexicographic choice and non-maximizing theories of the firm are suggested as examples of theories which are independent of the hedonistic framework. The general conclusion of the thesis states that in spite of the neutralization attempts and contrary to the common belief of many theorists, hedonism is still an important underlying conceptual framework of economic theory.