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An Economics-Based Rationale for the Rawlsian Social Welfare Program

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  • Stark, Oded

    (University of Bonn)

Abstract

We show that a social planner who seeks to allocate a given sum in order to reduce efficiently the social stress of a population, as measured by the aggregate relative deprivation of the population, pursues a disbursement procedure that is identical to the procedure adhered to by a Rawlsian social planner who seeks to allocate the same sum in order to maximize the Rawlsian maximin-based social welfare function. Thus, the constrained minimization of aggregate relative deprivation constitutes an economics-based rationale for the philosophy-based constrained maximization of the Rawlsian social welfare function.

Suggested Citation

  • Stark, Oded, 2020. "An Economics-Based Rationale for the Rawlsian Social Welfare Program," IZA Discussion Papers 13662, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp13662
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    References listed on IDEAS

    as
    1. Oded Stark & Fryderyk Falniowski & Marcin Jakubek, 2017. "Consensus Income Distribution," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 63(4), pages 899-911, December.
    2. Bossert, Walter & D'Ambrosio, Conchita, 2006. "Reference groups and individual deprivation," Economics Letters, Elsevier, vol. 90(3), pages 421-426, March.
    3. Harsanyi, John C., 1975. "Can the Maximin Principle Serve as a Basis for Morality? A Critique of John Rawls's Theory," American Political Science Review, Cambridge University Press, vol. 69(2), pages 594-606, June.
    4. Shlomo Yitzhaki, 1979. "Relative Deprivation and the Gini Coefficient," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 93(2), pages 321-324.
    5. John D. Hey & Peter J. Lambert, 1980. "Relative Deprivation and the Gini Coefficient: Comment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 95(3), pages 567-573.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Stark, Oded, 2024. "A Note on Sen's Representation of the Gini Coefficient: Revision and Repercussions," IZA Discussion Papers 16856, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    congruence of the algorithm with the Rawlsian social welfare program; Rawlsian social welfare function; social stress; aggregate relative deprivation (ARD); an algorithm of cost-effective policy response to ARD;
    All these keywords.

    JEL classification:

    • A13 - General Economics and Teaching - - General Economics - - - Relation of Economics to Social Values
    • D04 - Microeconomics - - General - - - Microeconomic Policy: Formulation; Implementation; Evaluation
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • H53 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Welfare Programs
    • P51 - Political Economy and Comparative Economic Systems - - Comparative Economic Systems - - - Comparative Analysis of Economic Systems

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