Fairness under Uncertainty
AbstractEver since its introduction by Foley  and Varian , the notion of fairness has been one of the most extensively used notion to evaluate allocations on an ethical basis. Whereas there is an extensive literature on the efficiency properties of allocations in economies with uncertainty the concept of an envy-free allocation has not been widely studied in economies with uncertainty. We introduce two very natural notions of equity in an economy under uncertainty, namely ex ante and ex post equity, show they can contradict efficiency requirements. In particular, the set of ex ante efficient and ex post envy-free allocations may be empty. We nevertheless show that, under special circumstances, one may prove the existence of allocations that are both ex ante efficient and ex post envy-free. Such is the case, in particular, in an economy with individual risk and no aggregate risk.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by HAL in its series Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) with number halshs-00086032.
Date of creation: 2002
Date of revision:
Publication status: Published, Economics Bulletin, 2002, 4, 18, 1-7
Note: View the original document on HAL open archive server: http://halshs.archives-ouvertes.fr/halshs-00086032
Contact details of provider:
Web page: http://hal.archives-ouvertes.fr/
Fairness; uncerainty; envy;
Other versions of this item:
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Malinvaud, E, 1973. "Markets for an Exchange Economy with Individual Risks," Econometrica, Econometric Society, Econometric Society, vol. 41(3), pages 383-410, May.
- Varian, Hal R., 1974.
"Equity, envy, and efficiency,"
Journal of Economic Theory, Elsevier,
Elsevier, vol. 9(1), pages 63-91, September.
- H. R. Varian, 1973. "Equity, Envy and Efficiency," Working papers, Massachusetts Institute of Technology (MIT), Department of Economics 115, Massachusetts Institute of Technology (MIT), Department of Economics.
- Cass, David & Chichilnisky, Graciela & Wu, Ho-Mou, 1996. "Individual Risk and Mutual Insurance," Econometrica, Econometric Society, Econometric Society, vol. 64(2), pages 333-41, March.
- Peter A. Diamond, 1967. "Cardinal Welfare, Individualistic Ethics, and Interpersonal Comparison of Utility: Comment," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 75, pages 765.
- Chiara Donnini & Maria Graziano & Marialaura Pesce, 2014. "Coalitional fairness in interim differential information economies," Journal of Economics, Springer, Springer, vol. 111(1), pages 55-68, February.
- de Clippel, Geoffroy, 2008.
"Equity, envy and efficiency under asymmetric information,"
Economics Letters, Elsevier,
Elsevier, vol. 99(2), pages 265-267, May.
- Geoffroy de Clippel, 2004. "Equity, Envy and Efficiency under Asymmetric Information," Working Papers, Brown University, Department of Economics 2004-19, Brown University, Department of Economics.
- Achille Basile & Maria Graziano & Marialaura Pesce, 2014.
"On fairness of equilibria in economies with differential information,"
Theory and Decision, Springer,
Springer, vol. 76(4), pages 573-599, April.
- Achille Basile & Maria Gabriella Graziano & Maria Laura Pesce, 2012. "On Fairness of Equilibria in Economies with Differential Information," CSEF Working Papers, Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy 303, Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy.
- Maria Laura Pesce, 2011. "Are Asymmetrically Informed Agents Envious?," CSEF Working Papers, Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy 292, Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy.
- Chew, Soo Hong & Sagi, Jacob S., 2012. "An inequality measure for stochastic allocations," Journal of Economic Theory, Elsevier, Elsevier, vol. 147(4), pages 1517-1544.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (CCSD).
If references are entirely missing, you can add them using this form.