TY - JOUR
T1 - Egalitarianism and incentives
AU - Debraj, Ray
AU - Ueda, Kaoru
N1 - Funding Information:
* Support under Grant PB90-0172 from the Ministerio de Educacion y Ciencia, Government of Spain, and Grant SBR-9414114 from the National Science Foundation is gratefully acknowledged. We are grateful to Abhijit Banerjee, Arindam Das Gupta, Glenn Loury, and Robert Rosenthal for useful comments on an earlier version. We thank an anonymous referee for detailed comments on a first draft.
PY - 1996/11
Y1 - 1996/11
N2 - A group of agents is collectively engaged in a joint productive activity. Each agent supplies an observable input, and output is then collectively shared among the members. A Bergson-Samuelson welfare function defined on individual utilities describes the social values of the agents. However, individual actions are taken on a selfish basis. The collective decision cannot be precommitted, and is made (after inputs are chosen) to maximize welfare conditional on the input decisions. This leads to inefficiency. The aim of this paper is to show formally that, contrary to popular belief, the degree of inefficiency decreases in the extent of egalitarianism embodied in the social welfare function. Journal of Economic Literature Classification Numbers: C72, D30, D63, P13.
AB - A group of agents is collectively engaged in a joint productive activity. Each agent supplies an observable input, and output is then collectively shared among the members. A Bergson-Samuelson welfare function defined on individual utilities describes the social values of the agents. However, individual actions are taken on a selfish basis. The collective decision cannot be precommitted, and is made (after inputs are chosen) to maximize welfare conditional on the input decisions. This leads to inefficiency. The aim of this paper is to show formally that, contrary to popular belief, the degree of inefficiency decreases in the extent of egalitarianism embodied in the social welfare function. Journal of Economic Literature Classification Numbers: C72, D30, D63, P13.
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U2 - 10.1006/jeth.1996.0124
DO - 10.1006/jeth.1996.0124
M3 - Article
AN - SCOPUS:0030295781
SN - 0022-0531
VL - 71
SP - 324
EP - 348
JO - Journal of Economic Theory
JF - Journal of Economic Theory
IS - 2
ER -