Social Choice and Individual Values

In Social Choice and Individual Values (1951), Kenneth J. Arrow introduced the "impossibility theorem". This theorem, a cornerstone of rational choice theory, posits that it's impossible to guarantee a societal preference ranking that consistently reflects individual preferences when there are three or more individuals and alternatives.123

The theorem assumes individuals have rational, complete, and transitive preferences. It also requires that any decision procedure be fair, meaning no single dictator dictates the outcome, and that collective rankings remain consistent even if alternatives change. These conditions are generally accepted as reasonable.1

The impossibility theorem challenges the idea of a collective democratic will and suggests that no single procedure can objectively aggregate individual desires into a universally rational social preference. This has significant implications for understanding democracy and political economy.1