by Tyler Cowen
on February 15, 2013 at 1:17 am
in Economics, Law, Philosophy
By Ronald Dworkin (pdf). Every economist (and many others) should read this article.
And his classic two-part article on “What is Equality?” is here and here, or if the latter is gated try here.
Just so we are all clear, Dworkin idea of equality is considered to operate within a framework which this wikipedia article does an acceptable job of explaining –
‘Luck egalitarianism is a view about distributive justice espoused by a variety of egalitarian and other political philosophers. According to this view, justice demands that variations in how well off people are should be wholly attributable to the responsible choices people make and not to differences in their unchosen circumstances. This expresses the intuition that it is a bad thing for some people to be worse off than others through no fault of their own.’ http://en.wikipedia.org/wiki/Luck_egalitarianism
By this standard, America is unequal, for reasons that Hayek explained back in the UK, during the darkest days of WWII, between 1940-1943. Hayek lived long enough to see how the UK was able to implement his ideas – sadly, those simple ideas are still apparently impossible to achieve in the U.S.
How’s that working out for UK?
In the eyes of the British themselves? Fantastically, as evidenced by the NHS’s prominent place of pride in the London Summer Olympics opening program –
‘Friday night’s spectacular Opening Ceremony, directed by Oscar-winning filmmaker Danny Boyle (Trainspotting, 28 Days Later, Slumdog Millionaire) was a star-studded celebration of British history, culture and sport. And featuring prominently in that history– and in last night’s ceremony– was the National Health Service, Britain’s single-payer, government-run system that has provided free, taxpayer-funded health care to all since 1948. In one segment of the ceremony, dozens of real NHS doctors and nurses danced jubilantly around “sick” children in glowing hospital beds while the massive letters ‘NHS’ burned brightly in flames in the center of Olympic Stadium.’ – http://digitaljournal.com/article/329524
Of course, a certain group of British citizens remained as opposed to the NHS as they were at its founding, but let’s be honest – who in America cares about the landed gentry or the wealthy aristocrats educated in private (well, technically ‘public’) schools?
The British remain extremely proud of how they implemented Hayek’s vision – but if you didn’t see the opening ceremony, maybe you could talk to someone from the UK? Even the tories don’t dare touch the NHS, because it would be instant political suicide.
So your argument for the efficacy of a system is based on a show that an admittedly leftist artist presents? Or is it based on rent seeking politics that make the system difficult to change?
Furthermore the idea that Britain is some bastion of luck egalitarianism is ridiculous. Just look at the council estates and the education system.
(I must assume you are just trolling.)
You know, as a fairly moderate and politically independent thinker, I find the idea that one artist acted independently to create a public British exhibition for the world to see .. a bit more unreasonable, trollish. An allusion to Twenty Twelve would have been better and closer to the mark.
The problem is that this can go against broadly utilitarian intuitions. For example, which society would you rather be a part of (assuming who you are in society is random):
Society A: everyone has a utility level of 100 (in arbitrary units; or pick some income number or happiness level or whatever).
Society B: 80% of the population has a utility level of 200 and 20% of the population has a utility level of 500.
According to (perhaps a naive version of) luck egalitarianism, society B would be more unjust, but I would bet most people would choose to be a member of society B rather than society A.
And (to tie it back to utilitarianism) that Society B is not only preferable, but that it is a better society and more just. You’d have to disconnect justice from happiness and preference to make the argument that Society A is more just, and I don’t think that that ascetic kind of justice is one that’s going to have much broad support (and certainly needs an argument for it).
Tyler, the equality links are the same, can you link to part two?
Dworkin lost me on page two when he said that when the pay-to-obtain and paid-to-part values are different Posner’s standard becomes indeterminate.
A gated version, Executive Summary: (1) paper refutes Posner (who btw is a strawman for many economists), who wishes judges to decide cases based on wealth maximization; (2) points out Posner’s wealth maximization (people will pay what they wish to get what they want) is not the same as Pareto Efficiency (economy produces at maximum efficiency, so in theory garbageman gets same effective salary as brain surgeon). This is because in the former there are path independent and cyclical effects due to fads (e.g., “grass is greener” then you find out greener due to leaking septic tank). Pareto Efficiency is also not good for deciding legal cases since many Pareto efficient states possible (e.g. do you want to become a psychiatrist or psychologist with same effective pay? Not much difference); (3) discusses Coase theorem–and with transaction costs perhaps the farmers rather than railroad deserve to be compensated for their railroad sparks; (4) engages in a dangerous, Communistic, argument that attempts to refute this question: “But it is unclear why social wealth is a worthy goal. Who would think that a society that has more wealth, as defined, is either better or better off than a society that has less, except someone who made the mistake of personifying society, and therefore thought that a society is better off with more wealth in just the way any individual is? Why should anyone who has not made this mistake think social wealth maximization a worthy goal?”–various ‘how many angels dance on a pin’ arguments advanced, but the author fails to see that despite the fact Posner is despised in law (the Sup. Ct. has rebuked him), in fact, cases are actually decided according to ‘social wealth’ so in fact the party with more money usually wins (too numerous to cite, and I don’t have space to explain–trust me, executive reader). Numerous strawmen, neologisms, tangents on this theme–largely of the author’s own devise. I’m sure a medieval scholar would feel at home. Ends, as I hinted above, that Posner’s social wealth goal is indeed useful if married to author’s ‘fairness’ test (p. 222). Surrebuttal to Posner in a postscript. DONE! I just saved you hours of reading, reader. You’re welcome.
Here is another link to part 2: http://philosophyfaculty.ucsd.edu/faculty/rarneson/courses/DWORKINeqofresources.pdf
Bruce Johnsen’s article “Wealth Is Value,” 15 Journal of Legal Studies 263 (1986), is a better response to Dworkin’s arguments than Posner’s response was.
Re the “pay to obtain” and “pay to part” claim in Dworkin’s piece, it’s interesting to note that Dworkin’s first criticism of Posner didn’t contain this claim. (I saw Dworkin’s first response, which I think has never been printed, because the Dworkin-Posner exchange took place at Cornell, where I was then teaching). Shortly after the original Dworkin-Posner exchange, Mark Kelman published a law review article in which he pointed to the (supposed) difference between what people would pay to get things and what they’d demand to part with them. Shortly after that, Dworkin’s paper was published with a reference to that supposed difference, but no citation to Kelman (or anyone else). One thing about Dworkin’s work that some people find annoying is his failure to give credit to people whose ideas appear in his work.
Luck egalitarianism has been implemented nowhere in the world with any degree of consistency, but it has been used in one form or another by leftists to selectively modify rules to favor their interest group du jour.
Otherwise it just gives trolls like blather-approval something to deface comment sections with.
Libertarianism has been implemented nowhere in the world with any degree of consistency, but it has been used in one form or another by rightists to selectively modify rules to favor their corporate donors du jour.
Otherwise, it just gives trolls like wiki something to deface comment sections with.
“Is Wealth a Value?” was, more or less, commission by me for a still-relevant Liberty Fund symposium in 1979 — published in the Journal of Legal Studies in 1980. (May I shamelessly refer the reader to my own article here “Law amid Flux”? ) It was on this occasion that Richard Posner, I believe, referred to Dworkin’s paper as a soufflé — beautiful, but nothing much there. The reader can decide for himself.
The parallel argument on behalf of social wealth maximization is, however,
much worse. It is false that even an individual is necessarily better off
if he has more wealth, once having more wealth is taken to be independent
of utility information.
This seems close to “It’s not just what you have; it’s how you use it.” Or, put another way, it’s not what you have, it’s what you want to have, and use.
In general I don’t have enough background knowledge to follow all the contours of the argument.
Dworkin’s logic is amazingly flawed. The core of his argument is a bait-and-switch where he sets up a repugnant straw man and uses it to claim that wealth should be ignored as a measure of value:
“Consider this hypothetical example. Derek has a book Amartya wants.
Derek would sell the book to Amartya for $2 and Amartya would pay $3
for it. T (the tyrant in change) takes the book from Derek and gives it to
Amartya with less waste in money or its equivalent than would be consumed
in transaction costs if the two were to haggle over the distribution of
the $1 surplus value. The forced transfer from Derek to Amartya produces
a gain in social wealth even though Derek has lost something he values
with no compensation. Let us call the situation before the forced transfer
takes place “Society 1” and the situation after it takes place “Society 2.” Is
Society 2 in any respect superior to Society 1? I do not mean whether the
gain in wealth is overridden by the cost in justice, or in equal treatment, or
in anything else, but whether the gain in wealth is, considered in itself, any
gain at all. I should say, and I think most people would agree, that Society
2 is not better in any respect.”
Clearly a society that allows a tyrant to arbitrarily transfer resources is repugnant and wrong, but that in no way implies that there is no value in allocating resources to those who value them the most. It seems self-evident to me that Society 2 has a better allocation of resources, even though bad methods were used to produce this outcome.
A much better hypothetical would be to consider a book that is sitting on the curb waiting to be hauled off in the trash. In Situation A, the book is found and taken by someone who values it at $2. In Situation B, the book is found and taken by someone who values it at $3. Is Situation B better than Situation A? Clearly it is, and I cannot imagine anyone arguing otherwise. Dworkin uses an emotionally loaded hypothetical to deny this basic fact, and then uses that denial as the basis for his argument.
Later, he tries to use an extreme example to decouple utility from willingness to pay. It is true that willingness to pay is an imperfect measure of utility, but it is the best one we have. He claims that “social wealth is divorced from utility” when he has only shown that there exists a situation where it is not a perfect measurement. The fact that an estimator has nonzero variance does not imply that the estimator is biased or that it is a useless tool.
I know that there are many different values, and that wealth is simply an instrumental way of attaining the good things in life. But wealth is, by definition, a tool used to obtain valuable things. It is the best way we have of measuring the value of things. There is value in reminding people that the map is not the territory, but wealth is the best map we have to the territory of desires and values and it is foolish to try to navigate a territory without even looking at a map.
“What is Equality?” is excellent, and I find Part I in particular to be a well-written and convincing argument.
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