Utility as Economic Meaning

Abstract

The concept of utility has played a major role in the history of economic thought, and it is still pivotal in most contemporary economic studies. But what is the meaning of utility? Here we take advantage of the philosophical literature to develop a theoretically robust answer to this question. Based on an analysis of the very diverse philosophical understandings of ?meaning?, we introduce a general definition encompassing this diversity. According to this definition, any account of a given act that can be endorsed by the agent performing this act qualifies as a ?meaning?. We argue that the concept of utility qualifies as economic meaning. This idea has two aspects. First, at a general level, because the axioms of the theory of choice are, in essence, easily understandable, utility can, in general, be conceived as a meaning. Second, more specifically, this very idea allows to define a standard to adjudicate whether specific instances of utility representation qualify as meanings. The main theoretical implication is that, when a given utility modelling fulfils the requirements to qualify as a meaning, then the stipulation of the axioms of the theory of choice is justified. This implication translates into concrete recommendations for applied economics.