Distributive Justice for Behavioural Welfare Economics

2020 ◽  
Vol 130 (628) ◽  
pp. 1114-1134
Author(s):  
Michael Mandler
Keyword(s):  
Social Welfare ◽  
Distributive Justice ◽  
Welfare Economics ◽  
Pareto Optimal ◽  
Policy Recommendations ◽  
Pareto Optima ◽  
Individual Preferences

Abstract The incompleteness of behavioural preferences can lead many or even all allocations to qualify as Pareto optimal. But the incompleteness does not undercut the precision of utilitarian policy recommendations. Utilitarian methods can be applied to groups of goods or to the multiple social welfare functions that arise when individual preferences are incomplete, and policymakers do not need to provide the preference comparisons that individuals are unable to make for themselves. The utilitarian orderings that result, although also incomplete, can generate a unique optimum. Non-separabilities in consumption reduce this precision but in all cases the dimension of the utilitarian optima drops substantially relative to the Pareto optima.

Symposium on Amartya Sen's philosophy: 2 Unstrapping the straitjacket of ‘preference’: a comment on Amartya Sen's contributions to philosophy and economics

2001 ◽  
Vol 17 (1) ◽  
pp. 21-38 ◽  
Author(s):  
Elizabeth Anderson
Keyword(s):  
Economic Theory ◽  
Social Welfare ◽  
Welfare Economics ◽  
Individual Behavior ◽  
Microeconomic Theory ◽  
Individual Preferences ◽  
Individual Welfare ◽  
Philosophy And Economics

The concept of preference dominates economic theory today. It performs a triple duty for economists, grounding their theories of individual behavior, welfare, and rationality. Microeconomic theory assumes that individuals act so as to maximize their utility – that is, to maximize the degree to which their preferences are satisfied. Welfare economics defines individual welfare in terms of preference satisfaction or utility, and social welfare as a function of individual preferences. Finally, economists assume that the rational act is the act that maximally satisfies an individual's preferences. The habit of framing problems in terms of the concept of preference is now so entrenched that economists rarely entertain alternatives.

Beyond GDP: The Quest for a Measure of Social Welfare. Part II

2012 ◽  
pp. 32-51 ◽  
Author(s):  
M. Fleurbaey
Keyword(s):  
Social Welfare ◽  
Social Relations ◽  
Well Being ◽  
Welfare Economics ◽  
Subjective Well Being ◽  
Alternative Approaches ◽  
Micro Level ◽  
Beyond Gdp

The second part of the paper is devoted to the non-monetary indicators of social welfare. Various approaches to the study of subjective well-being and happiness are described. The author shows what problems a researcher would encounter trying to analyze welfare on the micro-level and to take account of the cognitive and affective aspects of the individuals assessment of their well-being, as well as the relevance of social relations. The author also shows to what extent the alternative approaches, particularly the analysis of functionings and capabilities advanced by A. Sen are compatible to the modern welfare economics and what prospects the latter has.

ECONOMISTS ON PRIVATE INCENTIVES, ECONOMIC MODELS, AND THE ADMINISTRATIVE STATE: THE CLASH BETWEEN HAPPINESS AND THE SO-CALLED PUBLIC GOOD

2021 ◽  
Vol 38 (1) ◽  
pp. 152-169
Author(s):  
Sandra J. Peart
Keyword(s):  
Public Good ◽  
Economic Models ◽  
Welfare Economics ◽  
Social Goals ◽  
Administrative State ◽  
Individual Preferences ◽  
History Of Economics ◽  
Engineering Approach ◽  
History Of ◽  
Private Incentives

AbstractThis essay examines the administrative state as a ubiquitous phenomenon that results in part from the mismatch of incentives. Using two dramatic episodes in the history of economics, the essay considers two types of mismatch. It then examines how economists increasingly endorsed the “general good” as a unitary goal for society, even at the expense of private hopes and desires. More than this, their procedures and models gave them warrant to design mechanisms and advocate for legislation and regulations to “fix” the supposedly suboptimal choices of individuals in service to the overarching goal. The rise of New Welfare Economics dealt an additional blow to the sovereignty of individual motivations, notwithstanding that Hayek and Buchanan warned that this engineering approach allowed social goals to override individual preferences. Throughout, the argument is that it is important to recognize that people within or advising the administrative state are influenced by the same sorts of (private) motivations as actors throughout the economy.

Reconciling Normative and Behavioral Economics: An Application of the “Naturalistic Approach” to the Adaptation Problem

2014 ◽  
Vol 234 (2-3) ◽  
Author(s):  
Christian Schubert ◽  
Martin Binder
Keyword(s):  
Economic Theory ◽  
Well Being ◽  
Welfare Economics ◽  
Preference Formation ◽  
Individual Preferences ◽  
Opportunity Sets ◽  
The Individual ◽  
High Level ◽  
Adaptive Preference ◽  
Vexing Problem

SummaryWhile standard economic theory takes individual preferences as stable and “given”, i.e., independent of situational context, real-world preferences tend to vary with changing opportunity sets. This is exemplified by Aesop’s fable of the fox and the sour grapes. This phenomenon of “adaptive preference formation” poses a vexing problem for normative economics: preferences which constitute the measuring rod for welfare are in turn shaped by the (economic) situation of the individual, leading to problems epitomized by Amartya Sen’s “hopeless beggar” dilemma: The beggar, enduring objectively miserable circumstances, nonetheless claims to have all his preferences satisfied, which would lead orthodox welfare economics to establish a high level of well-being. For those who find this counterintuitive, different solutions for the “adaptation problem” have been proposed in the literature, typically centering on highly demanding rationality and information requirements. We argue that, in order to cope with this and related problems of preference endogeneity, welfare economics rather needs to account for recent psychological insights into the mechanisms that drive preference formation and change. We then use these insights to suggest and apply a procedural criterion of autonomous preference formation.

scholarly journals Improving Nash Social Welfare Approximations

2020 ◽  
Vol 68 ◽  
pp. 225-245
Author(s):  
Peter McGlaughlin ◽  
Jugal Garg
Keyword(s):  
Social Welfare ◽  
Optimal Allocation ◽  
Focal Point ◽  
Market Equilibrium ◽  
Fair Division ◽  
Pareto Optimal ◽  
Indivisible Goods ◽  
Market Prices ◽  
Economic Concept ◽  
Strongly Polynomial

We consider the problem of fairly allocating a set of indivisible goods among n agents. Various fairness notions have been proposed within the rapidly growing field of fair division, but the Nash social welfare (NSW) serves as a focal point. In part, this follows from the ‘unreasonable’ fairness guarantees provided, in the sense that a max NSW allocation meets multiple other fairness metrics simultaneously, all while satisfying a standard economic concept of efficiency, Pareto optimality. However, existing approximation algorithms fail to satisfy all of the remarkable fairness guarantees offered by a max NSW allocation, instead targeting only the specific NSW objective. We address this issue by presenting a 2 max NSW, Prop-1, 1/(2n) MMS, and Pareto optimal allocation in strongly polynomial time. Our techniques are based on a market interpretation of a fractional max NSW allocation. We present novel definitions of fairness concepts in terms of market prices, and design a new scheme to round a market equilibrium into an integral allocation in a way that provides most of the fairness properties of an integral max NSW allocation.

scholarly journals Increasing Inequality in Experience of Victimization During the Crime Drop: Analysing Patterns of Victimization in Scotland from 1993 to 2014–15

2019 ◽  
Vol 60 (3) ◽  
pp. 782-802
Author(s):  
Susan McVie ◽  
Paul Norris ◽  
Rebecca Pillinger
Keyword(s):  
Distributive Justice ◽  
International Crime ◽  
Crime Reduction ◽  
Repeat Victimization ◽  
Policy Recommendations ◽  
Crime Drop ◽  
Longitudinal Approach ◽  
Reduction Strategies ◽  
Crime Types

Abstract Research on the international crime drop has predominantly focused on the nature and extent of overall crime or changes in specific crime types, but less attention has been paid to how equally the crime drop has been distributed across society. Applying a novel quasi-longitudinal approach to Scottish victimization data, this article examines changes in the prevalence, frequency and type of victimization experienced. We argue that the crime drop has resulted in an increase in inequality between those at most and least risk of being a victim of crime, especially violence. The article contributes to theoretical debates on the crime drop, crime inequality and distributive justice, and provides policy recommendations on the importance of crime reduction strategies that target repeat victimization.

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