Inclusive and exclusive social preferences: A Deweyan framework to explain governance heterogeneity

Citation

Sacchetti S (2012) Inclusive and exclusive social preferences: A Deweyan framework to explain governance heterogeneity. Econometica, WP 36/2012. http://www.econometica.it/wp/wp36.pdf

Abstract
We suggest that Dewey's theory of value formation has implications for the contraposition between individual and social preferences in economics. We re-consider that distinction and introduce, instead, the notions of inclusive and exclusive social preferences. We then apply this distinction to governance forms and suggest an explanatory framework of governance heterogeneity which contrasts exclusive and inclusive governance structures. In the final discussion we illustrate a possible use of the framework for assessing cooperatives and social enterprises as well as traditional corporations. More generally, we argue that the assessment of governance heterogeneity would benefit from a consideration of the type of social preferences underlying formal as well as substantive involvement of publics.

Keywords
private-public dichotomy; social preferences; pragmatism; governance heterogeneity; stakeholders

JEL codes

• B00: History of Economic Thought, Methodology, and Heterodox Approaches
• L20: Firm Objectives, Organization, and Behavior: General
• L30: Nonprofit Organizations and Public Enterprise: General