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Fair Utilitarianism

Marc Fleurbaey and Stéphane Zuber
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Marc Fleurbaey: Princeton University

Working Papers from Princeton University, Department of Economics, Econometric Research Program.

Abstract: Utilitarianism is a prominent approach to social justice that has played a central role in economic theory. A key issue for utilitarianism is to define how utilities should be measured and compared. This paper draws on Harsanyi’s approach (Harsanyi, 1955) to derive utilities from choices in risky situations. We introduce a new normalization of utilities that ensures 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 propose normative principles that reflect these fairness requirements and characterize fair utilitarianism. We also study some implications of fair utilitarianism for risk sharing and collective risk aversion.

Keywords: Fairness; utilitarianism; risk sharing; collective risk aversion (search for similar items in EconPapers)
JEL-codes: D63 D81 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-hpe, nep-mic and nep-upt
Date: 2017-01
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Working Paper: Fair Utilitarianism (2017)
Working Paper: Fair Utilitarianism (2017) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:pri:metric:088_2017

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