Is Novelty always a good thing?Towards an Evolutionary Welfare Economics

Schumpeter’s and Hayek’s view of market coordination as being not aboutefficiency, but about endogenous change and never-ending discovery has beenincreasingly recognized even by the mainstream of economics. Underlying this view isthe notion of creative learning agents who bring about novelty. We argue that apart fromthe challenges it poses for positive theorizing, novelty (be it technological, institutional orcommercial) also has a complex normative dimension that standard welfare economics isunsuited to deal with.[...]