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Evaluations of Infinite Utility Streams: Pareto Efficient and Egalitarian Axiomatics

  • José Carlos R. Alcantud
  • María D. García-Sanz

Two factors influence the resolution of the conflict among infinite generations: the consistency/ethical postulates requested; and the utilities that each generation can possess. We contribute to qualifying the Basu-Mitra approach to this problem, that concerns social welfare functions. Firstly we examine efficiency and strengthened forms of Hammond Equity for the Future both when the feasible utilities are [0,1] and natural numbers. This complements Banerjee (Economics Letters, 2006) and Alcantud and Garcia- Sanz (Economics Letters, 2010). Secondly, we analyze the possibility of combining Pareto-efficiency and the spirit of the Hammond Equity principle for both specfications of the feasible utilities. Here the case study is richer since we analyze four different versions of this principle. We conclude that the Anonymity, Hammond Equity for the Future, and Hammond Equity ethics can be combined with weak specifications of the Pareto postulate at a time even through explicit social welfare functions.

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Article provided by Wiley Blackwell in its journal Metroeconomica.

Volume (Year): 64 (2013)
Issue (Month): 3 (07)
Pages: 432-447

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Handle: RePEc:bla:metroe:v:64:y:2013:i:3:p:432-447
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  1. Michele Lombardi & Roberto Veneziani, 2009. "Liberal Egalitarianism and the Harm Principle," Global COE Hi-Stat Discussion Paper Series gd09-078, Institute of Economic Research, Hitotsubashi University.
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  5. Lauwers, Luc, 2010. "Ordering infinite utility streams comes at the cost of a non-Ramsey set," Journal of Mathematical Economics, Elsevier, vol. 46(1), pages 32-37, January.
  6. Basu, Kaushik & Mitra, Tapan, 2003. "Aggregating Infinite Utility Streams with Inter-generational Equity: The Impossibility of Being Paretian," Working Papers 03-03, Cornell University, Center for Analytic Economics.
  7. Marco Mariotti & Roberto Veneziani, 2009. "‘Non-interference’ implies equality," Social Choice and Welfare, Springer, vol. 32(1), pages 123-128, January.
  8. Zame, William R., 2007. "Can intergenerational equity be operationalized?," Theoretical Economics, Econometric Society, vol. 2(2), June.
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  13. Alcantud, José C.R. & García-Sanz, María D., 2010. "Paretian evaluation of infinite utility streams: An egalitarian criterion," Economics Letters, Elsevier, vol. 106(3), pages 209-211, March.
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  18. repec:ebl:ecbull:v:4:y:2003:i:26:p:1-5 is not listed on IDEAS
  19. Asheim, Geir B. & Tungodden, Bertil, 2005. "A new equity condition for infinite utility streams and the possibility of being Paretian," Memorandum 08/2005, Oslo University, Department of Economics.
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