IDEAS home Printed from https://ideas.repec.org/a/eee/jetheo/v104y2002i2p462-472.html
   My bibliography  Save this article

Efficiency First or Equity First? Two Principles and Rationality of Social Choice

Author

Listed:
  • Tadenuma, Koichi

Abstract

The Pareto efficiency criterion is often in conflict with the equity criteria as no-envy or as egalitarian-equivalence: An allocation x that is Pareto superior to another allocation y can be inferior to y in consideration of equity. This paper formalizes two differnet principles of social choice under possible conflict of efficiency and equity. The efficiency-first principle requires that we should always select from efficient allocations, and when the efficiency criterion is not at all effective as a guide for selection, i.e., when all the available allocations are efficient or there is no efficient allocation, we should apply an equity criterion to choose desirable allocations. The equity-first principle reverses the lexicographic order of application of the two criteria. We examine rationality of the social choice rules satisfying these two principles. It is shown that the degree of rationality varies widely depending on which principle the social choice rules represent. Several impossibility and possibility results as well as a characterization theorem are obtained.
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Tadenuma, Koichi, 2002. "Efficiency First or Equity First? Two Principles and Rationality of Social Choice," Journal of Economic Theory, Elsevier, vol. 104(2), pages 462-472, June.
    • Handle: RePEc:eee:jetheo:v:104:y:2002:i:2:p:462-472
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0022-0531(01)92844-3
    Download Restriction: Full text for ScienceDirect subscribers only
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Kotaro Suzumura, 1996. "Interpersonal Comparisons of the Extended Sympathy Type and the Possibility of Social Choice," International Economic Association Series, in: Kenneth J. Arrow & Amartya Sen & Kotaro Suzumura (ed.), Social Choice Re-Examined, chapter 15, pages 202-229, Palgrave Macmillan.
    2. Suzumura, Kotaro, 1981. "On pareto-efficiency and the no-envy concept of equity," Journal of Economic Theory, Elsevier, vol. 25(3), pages 367-379, December.
    3. Feldman, Allan M & Kirman, Alan, 1974. "Fairness and Envy," American Economic Review, American Economic Association, vol. 64(6), pages 995-1005, December.
    4. Diamantaras, Dimitrios & Thomson, William, 1990. "A refinement and extension of the no-envy concept," Economics Letters, Elsevier, vol. 33(3), pages 217-222, July.
    5. Varian, Hal R., 1974. "Equity, envy, and efficiency," Journal of Economic Theory, Elsevier, vol. 9(1), pages 63-91, September.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Marc Fleurbaey, 2006. "To Envy or to be Envied? Refinements of No-Envy fot the Compensation Problem," IDEP Working Papers 0603, Institut d'economie publique (IDEP), Marseille, France, revised Jul 2006.
    2. Christian Arnsperger & David Croix, 1996. "Envy-minimizing unemployment benefits," Review of Economic Design, Springer;Society for Economic Design, vol. 2(1), pages 119-146, December.
    3. Chavas, Jean-Paul, 2008. "On fair allocations," Journal of Economic Behavior & Organization, Elsevier, vol. 68(1), pages 258-272, October.
    4. Nishimura, Yukihiro, 2003. "Optimal non-linear income taxation for reduction of envy," Journal of Public Economics, Elsevier, vol. 87(2), pages 363-386, February.
    5. Norihito Sakamoto, 2013. "No-envy, efficiency, and collective rationality," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 40(4), pages 1033-1045, April.
    6. Yukihiro Nishimura, 2008. "Envy Minimization In The Optimal Tax Context," Working Paper 1178, Economics Department, Queen's University.
    7. Thomson, William, 2011. "Chapter Twenty-One - Fair Allocation Rules," Handbook of Social Choice and Welfare, in: K. J. Arrow & A. K. Sen & K. Suzumura (ed.), Handbook of Social Choice and Welfare, edition 1, volume 2, chapter 21, pages 393-506, Elsevier.
    8. Kristof Bosmans & Z. Emel Öztürk, 2018. "An axiomatic approach to the measurement of envy," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 50(2), pages 247-264, February.
    9. Biung†Ghi Ju & Juan D. Moreno†Ternero, 2017. "Fair Allocation Of Disputed Properties," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 58(4), pages 1279-1301, November.
    10. Kverndokk, Snorre & Rose, Adam, 2008. "Equity and Justice in Global Warming Policy," International Review of Environmental and Resource Economics, now publishers, vol. 2(2), pages 135-176, October.
    11. Houy, Nicolas & Tadenuma, Koichi, 2009. "Lexicographic compositions of multiple criteria for decision making," Journal of Economic Theory, Elsevier, vol. 144(4), pages 1770-1782, July.
    12. Barrett, Christopher B., 1996. "Fairness, stewardship and sustainable development," Ecological Economics, Elsevier, vol. 19(1), pages 11-17, October.
    13. Takuya Obara & Shuichi Tsugawa & Shunsuke Managi, 2021. "$$\lambda $$ λ envy-free pricing for impure public good," Economic Theory Bulletin, Springer;Society for the Advancement of Economic Theory (SAET), vol. 9(1), pages 11-25, April.
    14. Walter Bossert & Marc Fleurbaey, 2015. "An Interview with Kotaro Suzumura," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 44(1), pages 179-208, January.
    15. Ávalos, Eloy, 2014. "Envidia, intolerancia y bienestar social [Envy, intolerance and social welfare]," MPRA Paper 61212, University Library of Munich, Germany.
    16. Roman Inderst & Eftichios Sartzetakis & Anastasios Xepapadeas, 2021. "Technical Report on Sustainability and Competition," DEOS Working Papers 2103, Athens University of Economics and Business.
    17. Mujcic, Redzo & Oswald, Andrew J., 2018. "Is envy harmful to a society's psychological health and wellbeing? A longitudinal study of 18,000 adults," Social Science & Medicine, Elsevier, vol. 198(C), pages 103-111.
    18. Eriksson, Kimmo & Karlander, Johan & Öller, Lars-Erik, 1996. "Hierarchical Assignments: Stability and Fairness," Working Papers 50, National Institute of Economic Research.
    19. Salvador Barberà & Walter Bossert & Kotaro Suzumura, 2021. "Daunou’s voting rule and the lexicographic assignment of priorities," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 56(2), pages 259-289, February.
    20. William C. Grant, 2023. "Correlated Equilibrium and Evolutionary Stability in 3-Player Rock-Paper-Scissors," Games, MDPI, vol. 14(3), pages 1-16, May.

    More about this item

    JEL classification:

    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jetheo:v:104:y:2002:i:2:p:462-472. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/622869 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.