IDEAS home Printed from https://ideas.repec.org/a/spr/sochwe/v32y2009i3p455-478.html
   My bibliography  Save this article

A fair solution to the compensation problem

Author

Listed:
  • Giacomo Valletta

    ()

Abstract

We study equity in economies where agents are endowed with different, non transferable, personal talents. To compensate them for such differences a given amount of money needs to be shared among them. We axiomatize a family of social orderings over allocations based on efficiency, fairness and robustness properties. Taking into account incentive constraints we derive the optimal policy: individuals with the same talent need to be equally compensated and only people whose level of talent is below a certain threshold should receive a positive compensation.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Giacomo Valletta, 2009. "A fair solution to the compensation problem," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 32(3), pages 455-478, March.
  • Handle: RePEc:spr:sochwe:v:32:y:2009:i:3:p:455-478 DOI: 10.1007/s00355-008-0335-7
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1007/s00355-008-0335-7
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Roland Iwan Luttens & Erwin Ooghe, 2007. "Is it Fair to 'Make Work Pay'?," Economica, London School of Economics and Political Science, vol. 74(296), pages 599-626, November.
    2. François Maniquet & Yves Sprumont, 2004. "Fair Production and Allocation of an Excludable Nonrival Good," Econometrica, Econometric Society, pages 627-640.
    3. Marc Fleurbaey & François Maniquet, 2005. "Fair social orderings when agents have unequal production skills," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, pages 93-127.
    4. Marc Fleurbaey & François Maniquet, 2006. "Compensation and responsibility," Working Papers halshs-00121367, HAL.
    5. Maniquet, Francois & Sprumont, Yves, 2005. "Welfare egalitarianism in non-rival environments," Journal of Economic Theory, Elsevier, vol. 120(2), pages 155-174, February.
    6. Thomson, W., 1996. "Consistent Allocation Rules," RCER Working Papers 418, University of Rochester - Center for Economic Research (RCER).
    7. Marc Fleurbaey & François Maniquet, 2006. "Fair Income Tax," Review of Economic Studies, Oxford University Press, pages 55-83.
    8. M. Fleurbaey & F. Maniquet, 2008. "Fair social orderings," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), pages 25-45.
    9. Marc Fleurbaey & Maurice Salles & John Weymark, 2008. "Justice, Political Liberalism and Utilitarianism," Post-Print hal-00246415, HAL.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Treibich, Rafael, 2014. "Welfare Egalitarianism with Other-Regarding Preferences," Discussion Papers of Business and Economics 22/2014, University of Southern Denmark, Department of Business and Economics.
    2. CALO-BLANCO, Aitor, 2012. "Responsibility, freedom, and forgiveness in health care," CORE Discussion Papers 2012004, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    3. Valletta Giacomo, 2012. "Health, Fairness and Taxation," Research Memorandum 017, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
    4. CALO-BLANCO, Aitor, 2012. "The compensation problem with fresh starts," CORE Discussion Papers 2012036, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    5. Aitor Calo-Blanco, 2014. "Fairness, freedom, and forgiveness in health care," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 43(1), pages 141-151, June.
    6. Giacomo Valletta, 2014. "Health, fairness and taxation," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 43(1), pages 101-140, June.
    7. MANIQUET, François, 2014. "Social ordering functions," CORE Discussion Papers 2014051, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).

    More about this item

    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:sochwe:v:32:y:2009:i:3:p:455-478. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sonal Shukla) or (Rebekah McClure). General contact details of provider: http://www.springer.com .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.