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On the Use of Distributional Weights in Social Cost-Benefit Analysis (1980)

In: Tackling Inequality

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  • Richard Layard

Abstract

Harberger (1978b) argues against using distributional weights on two grounds.1 (1) If the weights differ too much between people, they could be used to justify excessively inefficient projects. (2) Even so, the distributionalweights approach can lead to regressive marginal tax rates, which the public considers inequitable. This is Morton’s Fork indeed.2 I shall consider the two prongs in sequence.

Suggested Citation

  • Richard Layard, 1999. "On the Use of Distributional Weights in Social Cost-Benefit Analysis (1980)," Palgrave Macmillan Books, in: Tackling Inequality, chapter 13, pages 258-265, Palgrave Macmillan.
    • Handle: RePEc:pal:palchp:978-0-230-37528-4_13
    DOI: 10.1057/9780230375284_13
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