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The Sociological Foundations of Consumer Behavior: Their Implications for Economic Efficiency
Author(s) -
Collier Betty J.
Publication year - 1978
Publication title -
american journal of economics and sociology
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.199
H-Index - 38
eISSN - 1536-7150
pISSN - 0002-9246
DOI - 10.1111/j.1536-7150.1978.tb02789.x
Subject(s) - economics , externality , imperfect competition , microeconomics , competition (biology) , production (economics) , pareto principle , imperfect , welfare , economic efficiency , market power , pareto efficiency , class (philosophy) , neoclassical economics , perfect competition , market economy , operations management , philosophy , monopoly , artificial intelligence , computer science , biology , ecology , linguistics
A bstract . Neoclassical economic theory asserts that when the assumptions of perfect competition apply to a market economy , the allocation of inputs and/or outputs is such that by additional inputs or outputs no individual's welfare can be improved without diminishing some other individual's. That is, it is considered Pareto Efficient. When imperfect markets exist, however, externalities —influences from outside the economic process—in production and exchange, and indivisibilities—benefits or costs which cannot be allocated to or assessed against the individuals who enjoy or occasion them—appear and the market ceases to be an efficiently operated one. It is argued here that a fourth category of factors exists which may interfere with economic efficiency and that these factors are sociological in nature, factors arising from such considerations as class, status, role and power.