Behavioural utilitarianism and distributive justice

Giorgos Galanis and Roberto Veneziani

Economics Letters, 2022, vol. 215, issue C

Abstract: What are the distributive implications of utilitarianism? Is it compatible with a concern for equality, as many utilitarians have argued? We analyse these questions in the context of a pure allocation problem. We consider an infinitely-lived economy and, drawing on the behavioural literature, assume that individuals have reference-dependent preferences: agents’ utility is a function of current consumption and a reference point which captures consumption habits, or the agents’ upbringing. Assuming a history of inequalities in consumption, we show that the utilitarian allocation is equalising: starting from an unequal distribution, inequalities decrease over time at the utilitarian optimum. However, even though agents are in a relevant sense identical, equality does not obtain at any finite time.

Keywords: Utilitarianism; Inequality; Reference dependent preferences (search for similar items in EconPapers)
JEL-codes: D63 D9 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:215:y:2022:i:c:s0165176522001215

DOI: 10.1016/j.econlet.2022.110488

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