Generalized Utilitarianism and Harsanyi's Impartial Observer Theorem
Publication Type
Journal Article
Publication Date
11-2010
Abstract
Harsanyi's impartial observer must consider two types of lotteries: imaginary identity lotteries ("accidents of birth") that she faces as herself and the real outcome lotteries ("life chances") to be faced by the individuals she imagines becoming. If we maintain a distinction between identity and outcome lotteries, then Harsanyi-like axioms yield generalized utilitarianism, and allow us to accommodate concerns about different individuals' risk attitudes and concerns about fairness. Requiring an impartial observer to be indifferent as to which individual should face similar risks restricts her social welfare function, but still allows her to accommodate fairness. Requiring an impartial observer to be indifferent between identity and outcome lotteries, however, forces her to ignore both fairness and different risk attitudes, and yields a new axiomatization of Harsanyi's utilitarianism.
Keywords
Generalized utilitarianism, impartial observer, social welfare function, fairness, ex ante egalitarianism
Discipline
Economic Theory
Research Areas
Economic Theory
Publication
Econometrica
Volume
78
Issue
6
First Page
1939
Last Page
1971
ISSN
0012-9682
Identifier
10.3982/ECTA6712
Publisher
Econometric Society
Citation
Grant, Simon; KAJII, Atsushi; Polak, Ben; and Safra, Zvi.
Generalized Utilitarianism and Harsanyi's Impartial Observer Theorem. (2010). Econometrica. 78, (6), 1939-1971.
Available at: https://ink.library.smu.edu.sg/soe_research/1854
Additional URL
https://doi.org/10.3982/ECTA6712