Behavioural utilitarianism and distributive justice

Giorgos Galanis and Roberto Veneziani

CRETA Online Discussion Paper Series from Centre for Research in Economic Theory and its Applications CRETA

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 in nitely-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 and welfare, we show that the utilitarian allocation is equalising: starting from an unequal distribution, consumption and welfare 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 JEL Codes: D63; D9 (search for similar items in EconPapers)
Date: 2020
New Economics Papers: this item is included in nep-hpe, nep-mic and nep-upt
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Journal Article: Behavioural utilitarianism and distributive justice (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:wrk:wcreta:67

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