Arrow's Contribution: Social Choice Theory And Social Choice Theory

Kenneth Arrow, in 1951, came up with a result which became the basis for much of the work carried out in the field of social choice theory and welfare economics. It became the starting point for a lot of studies and research work of great practical significance. As the insights of Arrow's Theorem and social choice theory, have gradually come to be understood, their intellectual ramifications have been felt throughout the world of democratic theory. The theorem has been described as "one of the significant intellectual achievements of this century."

Arrow's result has consequences for the field of social choice theory, especially for the notion of democracy. Arrow's Impossibility Theorem proves that democratic collective decision-making processes cannot be both fair and rational. This proof applies to virtually any form of collective democratic decision making. According to Arrows result, democracy, in principle, cannot exist. Political theorists, legal theorists, economists, and others have found in Arrow's Theorem a range of other equally disturbing and profound implications for democratic theory and practice.
If a democratic state is to give the people what they want, it must be able to aggregate individuals' diverse preferences into a collective

The Theorem can be understood as a generalization and formalization of the voter's paradox. In theoretically searching for democratic procedures that would aggregate the given preferences of individuals into a single collective outcome, Arrow discovered that the paradox turns out to be an inescapable feature of any decision-making process likely to be considered even minimally fair. Simple requirements for fair or democratic processes turn out to conflict with the ability of collective decision-making institutions to generate consistent, rational collective