Equal Division, Efficiency, and the Sovereign Supply of Labor

Laurence Kranich ()

American Economic Review, 1994, vol. 84, issue 1, 178-89

Abstract: The canonical problem of equity in production economies consists of two agents with different tastes and abilities, each of whom contributes labor to produce a single consumption good. As a criterion for distributive justice, the author requires that if both agents work equal numbers of hours, they should divide the output equally. He also requires that the labor-supply decision should remain sovereign. Sufficient conditions are established for achieving an efficient allocation using a division procedure that is consistent with the equal-division-for-equal-work principle and it is shown that the conditions are satisfied in many standard economies. Copyright 1994 by American Economic Association.

Date: 1994
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