Introduction

Arthur Cecil Pigou has generally been counted as a traditional hedonistic utilitarian in the tradition of Bentham and Sidgwick. For example, Edgeworth observed that he ‘appears to have drawn inspiration from two high authorities on wealth and welfare.

In this chapter, we re-examine Pigou's concept of welfare, which consti­tutes the core of his welfare economics. We examine several studies that interpret the ethical basis of his welfare economics from different perspec­tives, asking whether it should be seen as welfarist or non-welfarist (more broadly, utilitarian or non-utilitarian). We would like to show that the non-welfarist aspects in Pigou, if they are detected, are considered to be a result of practical requirements. That is, practical issues made him, though implicitly, acknowledge the limitation of welfarism and forced him to rely upon non-welfarist information (needs, justice, etc., as we will see). This means that he took a substantial account of a wide range of non- welfarist values.

According to the most standard accounts (e.g. Sen and Williams (1982)), utilitarianism is comprised of three principles, which are (1) welfarism (all the value and criteria of policies should be reduced to pleasure or utility), (2) consequentialism (the rightness or wrongness of every policy is judged by consequences), and (3) sum-ranking (every individual’s good is to be summed up for comparison). Therefore, in order for Pigou to be regarded as non-utilitarian, it is enough to show that he denied at least one of those principles (note that, although non-welfarism implies non-utilitarianism, one can be a welfarist without being a utilitarian). Accordingly, our examination of Pigou focuses on the first principle, bringing in the others as necessary. We start, in Section 4.2, by considering previous studies of Pigou’s welfare economics, before providing a new interpretation, based on modern theory, in Section 4.3.

4.2