ECON 4270 Distributive Justice Lecture 4: Rawls and liberal equality

ECON 4270 Distributive JusticeLecture 4: Rawls and liberal equality

Hilde Bojerwww.folk.uio.no/hbojer

hbojer@econ.uio.no

February 16, 2011

ECON 4270 Distributive Justice Lecture 4: Rawls and liberal equality

Economics and welfarism

Rawls: liberal equality

Rawls: a Kantian

The basic structure of society

The social contract

Primary goods

The difference principle

ECON 4270 Distributive Justice Lecture 4: Rawls and liberal equality

Economics and welfarism

Economics and welfarism

3Normative economics:Optimal allocation (use) of resourcesCost benefit analysis

Takes the framework of laws and ethical norms as givenBased on the Pareto principleIdentical preferences (The representative consumer)Distributional analysis: more of a problem

ECON 4270 Distributive Justice Lecture 4: Rawls and liberal equality

Economics and welfarism

Economics and welfarism

3Normative economics:Optimal allocation (use) of resourcesCost benefit analysisTakes the framework of laws and ethical norms as givenBased on the Pareto principleIdentical preferences (The representative consumer)

Distributional analysis: more of a problem

ECON 4270 Distributive Justice Lecture 4: Rawls and liberal equality

Economics and welfarism

Economics and welfarism

3Normative economics:Optimal allocation (use) of resourcesCost benefit analysisTakes the framework of laws and ethical norms as givenBased on the Pareto principleIdentical preferences (The representative consumer)Distributional analysis: more of a problem

ECON 4270 Distributive Justice Lecture 4: Rawls and liberal equality

Economics and welfarism

4Utility theory: a convenient and powerful tool in both descriptiveand normative theory.

ECON 4270 Distributive Justice Lecture 4: Rawls and liberal equality

Rawls: liberal equality

John Rawls and liberal equality

5John Rawls: A Theory of Justice (1971)Changed the whole academic discourse about distributive justiceIs frequently misrepresented, particularly in economic textbooks,So-called Rawlsian welfare function’ describes him as a welfarist

ECON 4270 Distributive Justice Lecture 4: Rawls and liberal equality

Rawls: liberal equality

6Rawls was the first in recent time to give a serious critique ofutilitarianismHe did not know about welfarism in economic normative theoryTwo criticisms:1. Utilitarianism postulates individual welfare as a universal good.Does not allow for different conceptions of the good2. Does not conform to the Kantian imperative that one personshould never be considered as means to the ends of another personWill become clearer later, I hope.

ECON 4270 Distributive Justice Lecture 4: Rawls and liberal equality

Rawls: liberal equality

Rawls’s liberalism

7A liberal society is a society which allows different,conflictingeven not commensurabledefinitions of the good

ECON 4270 Distributive Justice Lecture 4: Rawls and liberal equality

Rawls: a Kantian

Rawls: a Kantian

8Two important Kantian tenets:(categorical imperatives)

I You shall act so that your actions accord with a general ruleyou can accept

I No person should be treated as a means to the ends of otherpersons.

Kantian ethics is deontological (absolute rules) and concernpersonal ethicsRawls’s project: to apply Kantian ethics to the organisation ofsociety

ECON 4270 Distributive Justice Lecture 4: Rawls and liberal equality

The basic structure of society

The basic structure of society

9Rawls theory of justice concernsthe basic structure of societynot day to day decisions about distribution and allocation ofresources.Which are the basic structures of society?

ECON 4270 Distributive Justice Lecture 4: Rawls and liberal equality

The basic structure of society

The basic structure of society

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I Citizenship and rights

I Ownership of property and natural resources

I Size and role of public sector

I Size and role of the market

I The family

ECON 4270 Distributive Justice Lecture 4: Rawls and liberal equality

The basic structure of society

An important premiss

11The existence of an organised societywith laws and securityand division of labourcreates an economic ‘surplus’to the advantage of everybodyand in particular: to the advantage of the most well to-do.Who have the most to losethe least advantaged have the least to lose

ECON 4270 Distributive Justice Lecture 4: Rawls and liberal equality

The social contract

The social contract

12A sort of constitution for constitutionsdescribing the fundamental rules of societyShould, according to Rawls, be unanimousand voluntary

ECON 4270 Distributive Justice Lecture 4: Rawls and liberal equality

The social contract

The original position

13Is a thought experiment,a device for thinking about the social contractThe persons in the OP are to chooseunanimouslythe social contract of a society they themselves would choose tolive in.They are to choose in enlightened self-interest

ECON 4270 Distributive Justice Lecture 4: Rawls and liberal equality

The social contract

The veil of ignorance

14The persons do not know their position in societyThey do not know what kind of persons the are (gender, talents,race etc)They do not know their preferencesor their conception of the good

ECON 4270 Distributive Justice Lecture 4: Rawls and liberal equality

The social contract

The veil of ignorance

15THICK VEIL OF IGNORANCE(Harsanyi assumes preferences are known)Why?Rawls contends that our preferences are, at least to some extent,formed by the society we live in.

ECON 4270 Distributive Justice Lecture 4: Rawls and liberal equality

The social contract

Two basic principles

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1. Complete liberty for everyone to the extent that this libertydoes not hinder the liberty of others

2. Economic equality except when inequality is to the advantageof all

The second principle is also called the difference principle(See textbook for exact quotes)

ECON 4270 Distributive Justice Lecture 4: Rawls and liberal equality

The social contract

Principle of liberty

17Follows from the fact that the parties in the OP do not know theirpreferences,or their conception of the good.Cf the definition of a liberal society above.Is the usual liberal formulationImplies the usual civic liberties: democracy, right to vote,

ECON 4270 Distributive Justice Lecture 4: Rawls and liberal equality

The social contract

Primary goods

18By economic equality Rawls means equality ofprimary goodsgoods that everyone needs, whatever their preferences,to further their project in life, their conception of the good.

ECON 4270 Distributive Justice Lecture 4: Rawls and liberal equality

The social contract

Primary goods

19Two important primary goods are1. Income and wealth2. The social bases of self-respect2 should always be equally distributed

ECON 4270 Distributive Justice Lecture 4: Rawls and liberal equality

The difference principle

Some implications of the difference principle

20For simplicity: advantage for allbecomes advantage to the least advantaged group

ECON 4270 Distributive Justice Lecture 4: Rawls and liberal equality

The difference principle

21Figure 5.1

ECON 4270 Distributive Justice Lecture 4: Rawls and liberal equality

The difference principle

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Figure 5.2

ECON 4270 Distributive Justice Lecture 4: Rawls and liberal equality

The difference principle

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Figure 5.3