We study fairness in economies with one private good and one partially excludable nonrival good. A social ordering function determines for each profile of preferences an ordering of all conceivable allocations. We propose the following Free Lunch Aversion condition: if the private good contributions of two agents consuming the same quantity of the nonrival good have opposite signs, reducing that gap improves social welfare. This condition, combined with the more standard requirements of Unanimous Indifference and Responsiveness, delivers a form of welfare egalitarianism in which an agent's welfare is measured by the quantity of the nonrival good that, consumed at no cost, would leave her indifferent to the bundle she is assigned. Copyright The Econometric Society 2004.
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Chambers, Christopher P. & Hayashi, Takashi, .
"Money metric utilitarianism,"
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Marc Fleurbaey & Francois Maniquet, 2002.
"Fair Income Tax,"
Economics Working Papers
0021, Institute for Advanced Study, School of Social Science.
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Other versions:
MARC FLEURBAEY & FRANÇOIS MANIQUET, 2006.
"Fair Income Tax,"
Review of Economic Studies,
Blackwell Publishing, vol. 73(1), pages 55-83, 01.
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