Purpose – This paper draws upon the work of Georgescu-Roegen to outline some theoretical alternatives to standard welfare theory, and to examine the policy implications of discarding the Walrasian core of neoclassical economics. Design/methodology/approach – Current work in behavioral economics and game theory shows that economic behavior depends on social context, a point understood by social economists for a hundred years or more. This work is related to Georgescu's contributions to utility theory and bioeconomics. Findings – Neoclassical welfare economics continues to dominate economic theory and policy even though its theoretical foundations, economic man and perfect competition, have been discredited by mainstream theorists. Economic processes take place in specific social contexts and also coevolve with the biophysical universe. Practical implications – Although modern economics is incorporating many of Georgescu's insights about human preferences it has yet to come to grips with the fact that human economic activity is shaped by its biophysical context. It is believed this should be a major focus of future economic research. Originality/value – Provides further insights into welfare theory and bioeconomics.
Behavioural economics, Economics, Social welfare economics
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