An Economic Modeling of Individual Capability

Abstract

Based on these preliminary tasks, Chap. 4 formulates the capability approach in an economic framework. Technically speaking, the capability approach can be formulated as an extended maximization model in economics by extending its domain to include the functioning space. This extended framework, including both commodity spaces and functioning spaces, on the one hand, demonstrates the robustness of the general equilibrium model in economics, and on the other hand, clearly shows characteristics of the capability approach distinguished from the traditional utility approach. It is thus suggested in Chap. 4 that the capability approach can compel us to carefully review basic concepts in traditional economic theory relying on the concept of equilibrium and individual rationality and criteria of optimality and efficiency.