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What is Welfare?
The study of Welfare in economics deals with the minimal level relates to the social support and well being provision. This one is also known as Public aid and maximum time it indicates the support of government to the public. It can also be expressed as a type of Charity.
The study associates with how to evaluate the cumulative level. This is very important for the government organization to analyze and to make proper decision.
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How to give the proper direction of measuring Welfare in social activity?
- Cardinal Utility.
- Ordinal Utility.
What are the basic points of Cardinal Utility?
- Observation is required for measuring scale for its accuracy.
- Preference as well as exogenously provided.
- Providing of additional consumption or increasing of some smaller utility.
- Function of utility related to interpersonally commensurable.
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Required Criteria
A lot of various criteria affect the actual motto of Welfare as-
- Marginal rate or Transformation.
- Marginal rate of Substitution.
- Revenue product and the resource cost must be equal.
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