Title

Fair Utilitarianism

Author(s)

Marc Fleurbaey Marc Fleurbaey (Princeton University)

Stephane Zuber Stephane Zuber (Paris School of Economics)

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.

Creation Date

2017-01

Section URL ID

Paper Number

088_2017

URL

http://detc.princeton.edu/wp-content/uploads/2017/02/wp088_2017_Fleurbaey-Zuber_Fair-Utilitarianism.pdf

File Function

Jel

D63, D81

Keyword(s)

Fairness, utilitarianism, risk sharing, collective risk aversion

Suppress

false

Series

10