IDEAS home Printed from https://ideas.repec.org/p/zbw/esprep/342974.html

The Incentive Costs of Welfare Judgments

Author

Listed:
  • Daske, Thomas

Abstract

We ask which welfare judgments can be institutionalized without incentive costs when agents’ material and distributive preferences are private information. A policy rule is definitely implementable if it is implementable under arbitrary variation in the distribution of types: the normative end remains fixed, while the institutional means - the transfer scheme - may adjust to the distribution. We interpret an ex post budget imbalance, if required for definite implementation, as an incentive cost: it entails external subsidies or resource destruction. We find that a policy rule is costless only if it locally admits a welfare representation as aggregate material surplus plus a relational component. Every such relational component must obey a common normative grammar. A substantive subclass satisfying this grammar is globally attainable. Costlessness thus disciplines welfare evaluation without eliminating normative choice. We illustrate this normative freedom through three relational welfare judgments in public-good provision: political restraint, subsidiarity, and minority protection.

Suggested Citation

  • Daske, Thomas, 2026. "The Incentive Costs of Welfare Judgments," EconStor Preprints 342974, ZBW - Leibniz Information Centre for Economics.
  • Handle: RePEc:zbw:esprep:342974
    as

    Download full text from publisher

    File URL: https://www.econstor.eu/bitstream/10419/342974/1/The-Incentive-Costs-of-Welfare-Judgments.pdf
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis

    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:zbw:esprep:342974. See general information about how to correct material in RePEc.

    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.

    We have no bibliographic references for this item. You can help adding them by using 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.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ZBW - Leibniz Information Centre for Economics (email available below). General contact details of provider: https://edirc.repec.org/data/zbwkide.html .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.