From Arrow's Theorem to Incentives and Price Dynamics

Abstract

Abstract Arrow's impossibility theorem has served as a dominant result within the social sciences for the last half-century. But, does it mean what we thought it did? Does it really require a dictator, or are there alternative, more benign interpretations? By developing an alternative interpretation, we discover that Arrow's result has interesting implications in a variety of topics ranging from the free rider problem of economics, incentives, and even an explanation for the chaotic behavior of price dynamics.