Fair Utilitarianism

Marc Fleurbaey and Stéphane Zuber

PSE-Ecole d'économie de Paris (Postprint) from HAL

Abstract: Utilitarianism plays a central role in economics, but there is a gap between theory, where it is dominant, and applications, where monetary criteria are often used. For applications, a key di culty for utilitarianism remains to de ne how utilities should be measured and compared across individuals. Drawing on Harsanyi's approach (Harsanyi, 1955) involving choices in risky situations, we introduce a new normalization of utilities that is the only one ensuring that: 1) a transfer from a rich to a poor is welfare enhancing, and 2) populations with more risk averse people have lower welfare. We embed these requirements in a new characterization of utilitarianism and study some implications of this "fair utilitarianism" for risk sharing, collective risk aversion and the design of health policy.

Keywords: Social risk; Utilitarianism; Fairness (search for similar items in EconPapers)
Date: 2021-05
New Economics Papers: this item is included in nep-cwa, nep-isf and nep-upt
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-01441070v4
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Published in American Economic Journal: Microeconomics, 2021, 13 (2), pp.370-401. ⟨10.1257/mic.20170234⟩

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Related works:
Journal Article: Fair Utilitarianism (2021)
Working Paper: Fair Utilitarianism (2021)
Working Paper: Fair Utilitarianism (2021)
Working Paper: Fair Utilitarianism (2017)
Working Paper: Fair Utilitarianism (2017)
Working Paper: Fair Utilitarianism (2017)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:pseptp:halshs-01441070

DOI: 10.1257/mic.20170234

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