Abstract
Fairness can be incorporated into Harsanyi’s utilitarianism through all-inclusive utility. This retains the normative assumptions of expected utility and Pareto-efficiency, and relates fairness to individual preferences. It makes utilitarianism unfalsifiable, however, if agents’ all-inclusive utilities are not explicitly specified. This note proposes a two-stage model to make utilitarian welfare analysis falsifiable by specifying all-inclusive utilities explicitly through models of individual fairness preferences. The approach is applied to include fairness in widely discussed allocation examples.
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Acknowledgements
I am grateful to Peter P.Wakker and seminar participants at the Decision and Uncertainty Workshop 2006 in Paris and FUR XII in Rome for helpful comments.
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Open Access This is an open access article distributed under the terms of the Creative Commons Attribution Noncommercial License (https://creativecommons.org/licenses/by-nc/2.0), which permits any noncommercial use, distribution, and reproduction in any medium, provided the original author(s) and source are credited.
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Trautmann, S.T. Individual fairness in Harsanyi’s utilitarianism: operationalizing all-inclusive utility. Theory Decis 68, 405–415 (2010). https://doi.org/10.1007/s11238-008-9104-4
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DOI: https://doi.org/10.1007/s11238-008-9104-4