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Equal Division, Efficiency, and the Sovereign Supply of Labor

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  • Kranich, Laurence

Abstract

The canonical problem of equity in production economies consists of two agents with different tastes and abilities, each of whom contributes labor to produce a single consumption good. As a criterion for distributive justice, the author requires that if both agents work equal numbers of hours, they should divide the output equally. He also requires that the labor-supply decision should remain sovereign. Sufficient conditions are established for achieving an efficient allocation using a division procedure that is consistent with the equal-division-for-equal-work principle and it is shown that the conditions are satisfied in many standard economies. Copyright 1994 by American Economic Association.

Suggested Citation

  • Kranich, Laurence, 1994. "Equal Division, Efficiency, and the Sovereign Supply of Labor," American Economic Review, American Economic Association, vol. 84(1), pages 178-189, March.
    • Handle: RePEc:aea:aecrev:v:84:y:1994:i:1:p:178-89
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    Cited by:

    1. Ratul Lahkar & Rezina Sultana, 2020. "Affirmative Action in Large Population Contests," Working Papers 40, Ashoka University, Department of Economics.
    2. Akira Yamada & Naoki Yoshihara, 2008. "Mechanism design for a solution to the tragedy of commons," Review of Economic Design, Springer;Society for Economic Design, vol. 11(4), pages 253-270, February.
    3. Jörg Franke, 2007. "Does Affirmative Action Reduce Effort Incentives? A Contest Game Analysis," UFAE and IAE Working Papers 711.07, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
    4. Franke, Jörg, 2012. "Affirmative action in contest games," European Journal of Political Economy, Elsevier, vol. 28(1), pages 105-118.
    5. Arguedas, Carmen & Kranich, Laurence, 1997. "Allocating environmental costs among heterogeneous sources: The linear damage equivalent mechanism," UC3M Working papers. Economics 6042, Universidad Carlos III de Madrid. Departamento de Economía.

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