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August 25, 2004

What Do People Think is Fair?

I was just reading a good survey article on what people think is fair (as opposed to the usual article on this topic, which asks what *is* fair),

James Konow (2003) "Which Is the Fairest One of All? A Positive Analysis of
Justice Theories," Journal of Economic Literature, 41: 1188- 1239 (December (2003)

Alas, the general impression from this long and careful article is that people don't think very hard about what is fair, and so it all depends on how you phrase the questions. They like equality, sort of, but not if people have exerted different efforts, or if equality hurts general prosperity. Thus, the numerous careful attempts to find out what people think is fair come to grief, because people haven't thought it through,even if you set up the questions so self-interest does not cloud the answer.

This is just as we should expect. In daily life, distinguishing between equality as a goal in itself, as an approximation to the equating of marginal utilities of income, and as a way to avoid envy is not important. We are still working on the implementing the idea that just because somebody knows the mayor they shouldn't have their house assessed at a lower taxable value. Something like that is bad under pretty much any ethical theory, so everybody except the academically curious postpone figuring out the precisely correct ethical theory to the day when blatant injustice has been extirpated.

Here's one excerpt that does seem worth remembering, though:

Mikula and Thomas Schwinger (1973), for example, study allocation decisions among 36 pairs of soldiers in the same unit who perform a task that generates joint earnings. They find that many subjects who perform well relative to their partners act against their own interests and allocate earnings equally, an effect that is stronger when subjects are paired with partners they like. This result, which Mikula and his colleagues have identified elsewhere (see Mikula 1980), stands in stark contrast, however, to the "self-interest" bias that almost all other researchers find in allocation experiments (e.g., Robert Forsythe et al. 1994; Elizabeth Hoffman et al. 1994). The fact that each group in Mikulas experiments favors a rule that is to its disadvantage, equality by high performers and proportionality by low performers, suggests that his experimental design is not capturing a distributive preference for equality, which should be shared by all, but rather something closer to a "generosity bias" on the part of both groups.

This shows how hard it is to use experiments to find out people's preferences.

Posted by erasmuse at August 25, 2004 03:48 PM

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More articles should be written with titles like "Do people think?"

Posted by: m. rasmusen at August 28, 2004 11:43 PM

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