In economic analysis, it is usually assumed that each individuals well-being (mental welfare) depends on her or his own resources (material welfare). A typology is provided of the ways in which one persons well-being may depend on the material resources of other persons. When such dependencies are taken into account, standard Paretian analysis of welfare needs to be modified. Pareto efficiency on the level of material resources need not coincide with Pareto efficiency on the level of well-being. A change in (...) economic conditions that is Pareto efficient in the standard sense, i.e., with respect to material resources, may nevertheless sacrifice one persons well-being to that of another. It is shown that under plausible assumptions, Pareto efficiency on the level of well-being may require the reduction of inequality on the level of material resources. (shrink)

A recurrent challenge in applied ethics concerns the development of principles that are both suitably general to cover various cases and sufficiently exact to guide behavior in particular instances. In business ethics, two central approaches—stockholder and stakeholder—often fail by one or the other requirement. The author argues that the failure is precipitated by their reliance upon “universal” theory, which views the justification of principles as both independent of their context of application and universally appropriate to all contexts. The author develops (...) a contextual interpretation of “constructivism” as an alternative approach, and argues that this alternative meets the above challenge. (shrink)

(2013). On Justice and Other Values: G.A. Cohen's Political Philosophy and the Problem of Trade-offs. Philosophical Papers: Vol. 42, No. 1, pp. 1-24. doi: 10.1080/05568641.2013.774721.

Contrary to the received view, decision theory is not primarily devoted to instrumental (ends-to-means) reasoning. Instead, its major preoccupation is the derivation of ends from other ends. Given preferences over basic alternatives, it constructs preferences over alternatives that have been modified through the addition of value object modifiers (modes) that specify probability, uncertainty, distance in time etc. A typology of the decision-theoretical modes is offered. The modes do not have (even extrinsic) value, but they transform the value of objects to (...) which they are applied. A rational agent's total set of preferences should be coherent, but from this it does not follow that her preferences over mode-containing objects have to be derivable from her preferences over mode-free objects. (shrink)

During the course of life, it is common to make some decisions that prove to be correct. Some of these choices are made without a specific reason, but only out of habit or intuitively, while others are based on judgments and motivations. However, when we claim that a decision is “right”, what kind of judgment are we referring to? On the one hand, the term “right” (or “wrong”) often refers to abstract norms. Usually, truth and falsehood serve as criteria in (...) these cases. In such situations, judgments about what is “right” or “wrong” depend strictly on an accurate rational evaluation, which is instrumental in guiding individuals to undertake or avoid certain actions. On the other hand, there is a sense of justice that concerns ethics and values. In these circumstances, a decision is generally considered “right” if it is based on a criterion of judgment that allows individuals to make a decision freely, without being bound by an abstract norm, but rather by elaborating the choice as the realization of what they consider good and just. In this paper will examine and redefine the concept of “right choice”, acknowledging the above mentioned dual nature of its meaning. It will be argued there is a link between what abstract norms dictate to do, in order to reach a formally correct decision, and what, instead, depends on merely reasons and attitudes. This connection is indeed ensured by wise decisions. (shrink)

This paper investigates a series of normative principles that are used to justify different aspects of executive compensation within business firms, as well as the remuneration of lower-ranking employees. We look at how businesses perform pay benchmarking; employees’ engagement, fidelity and loyalty ; and the acceptability of what we call both-ends-dipping, that is, receiving both ex ante and ex post benefits for the same work. We make two observations. First, either different or incoherent principles are used to justify the pay (...) of executives compared to employees, or the same principles are applied differently. Second, these differences or inconsistencies tend to be to the benefit of executives and/or to the detriment of employees. We conclude by asking whether there is any reason for thinking differently about executive pay than we do about employee pay. Our analysis leads us to question the principles justifying current executive compensation and to wonder if these principles are potentially being instrumentalized to serve other ends. (shrink)

This paper argues that the standard characterisation of the equity-efficiency trade-off as set out in this symposium by Joe Heath overstates the tension between these two values. The reason lies in the fact that economists tend to take individual labour supply preferences as given, which leads to a superficial analysis of the concepts of reservation wage and of economic rent. The paper suggests that we should instead think of reservation wages as variable and as influenced by social norms. Social norms (...) play a double role in this context. First, they represent a constitutive element of market competition; second, they can be a determinant of income inequalities. From this perspective, a certain share of high reservation wages sustained by contingent inegalitarian social norms should count as economic rent. The last section of the paper strengthens this conclusion further by drawing a parallel between expensive tastes in consumption and a certain class of high reservation wages. To the extent that the latter are underpinned by social norms rather than efficiency considerations, not paying them is both just and efficient. (shrink)

The main aim of this paper is to act as a corrective to the comparatively deafening silence of egalitarian political philosophy’s response to the Great Recession. The paper thus provides an accessible analysis of a new strand of empirical research into the causes of the crisis. This new literature, which has largely gone unnoticed by the broader philosophical community, maintains that the main driver of financial instability is income and wealth inequality coupled with income stagnation at the bottom of the (...) income distribution. Building on this empirical research, the paper puts forward six connections between egalitarian political philosophy broadly construed, and the findings of the new literature it surveys. These connections are understood as operating in two directions: that is, they both provide reasons for egalitarians to play a larger role in debates concerning the moral aspects of financial instability, and also offer valuable insights to egalitarians to reorient their position concerning central facets of their arguments. (shrink)

In the future systems of ambient intelligence will include decision support systems that will automate the process of discrimination among people that seek entry into environments and to engage in search of the opportunities that are available there. This article argues that these systems must be subject to active and continuous assessment and regulation because of the ways in which they are likely to contribute to economic and social inequality. This regulatory constraint must involve limitations on the collection and use (...) of information about individuals and groups. The article explores a variety of rationales or justifications for establishing these limits. It emphasizes the unintended consequences that flow from the use of these systems as the most compelling rationale. (shrink)

This paper investigates a series of normative principles that are used to justify different aspects of executive compensation within business firms, as well as the remuneration of lower-ranking employees. We look at how businesses perform pay benchmarking; employees’ engagement, fidelity and loyalty ; and the acceptability of what we call both-ends-dipping, that is, receiving both ex ante and ex post benefits for the same work. We make two observations. First, either different or incoherent principles are used to justify the pay (...) of executives compared to employees, or the same principles are applied differently. Second, these differences or inconsistencies tend to be to the benefit of executives and/or to the detriment of employees. We conclude by asking whether there is any reason for thinking differently about executive pay than we do about employee pay. Our analysis leads us to question the principles justifying current executive compensation and to wonder if these principles are potentially being instrumentalized to serve other ends. (shrink)