"Comparative Examination of Equity in Economics"
MURAKAMI Shinji
last update: 20151224
Comparative Examination of Equity in Economics
MURAKAMI Shinji
Abstract:
This paper tries to examine two concepts of equity in economics from the perspective of informational basis.
The first concept is called equity as no-envy. The defects of this equity are the difficulty of distinguishing wellbeing
levels, strategy-proofness and adaptive preference formation, of which the latter two result from the wellknown
problem of subjective preference.
In contrast to equity as no-envy, the second concept of equity depends on objective types. This equity,
discussed by Peyton Young, is composed of impartiality, consistency and a priority method, all of which are
based on types. This avoids the difficulties caused by subjective preference. However, a type is itself determined
by subjective choice through majority voting. Moreover, a simple majority does not reflect minority opinions.
This paper suggests Amartya Sen's capability approach as a substitute for the informational basis of the
above two concepts of equity. The capability approach is based on public judgments which are formed from
mutual discussion and includes a social decision procedure which considers the minority according to Thomas
Scanlon's concept of reason. In this way, the capability approach solves the problems of subjective preference
and majority voting and thus improves equity theory.
Keywords: Equity, Informational basis, Equity as no-envy, Priority method, Capability approach
REV: 20151224