A mixed Bentham–Rawls criterion for intergenerational equity: Theory and implications

Abstract

JEL classification: D63 H43 O21 Q20Keywords: Intergenerational equity Maximin Sustainable development a b s t r a c t This paper proposes a welfare criterion that balances the need for development and the concern for the least advantaged generations, and explores its implications. This criterion, called the mixed Bentham-Rawls criterion, moderates the effect of discounting, yet permits some degree of intertemporal trade-off. It is a weighted average of two terms: (a) the sum of discounted utilities and (b) the utility level of the least advantaged generation. We derive necessary conditions to characterize growth paths that satisfy our criterion, and show that in some models with familiar dynamic specifications, an optimal path exists and displays appealing characteristics.

Combining rights and welfarism: a new approach to intertemporal evaluation of social alternatives

“…John Rawls [23] pointed out that "optimal growth" (under some utilitarian objective) may unreasonably require too much savings from poor generations for the benefits of their wealthier descendants. 1 More recently, the same rationale has led environmentalists to argue that the present generations, in their pursuit of wealth and wellbeing, are depriving future generations of their rights to natural assets. Sustainable development has been described in the Brundtland report [33] as development "that meets the needs of the present without compromising the ability of future generations to meet their own needs."…”

“…Reflecting the concerns for rights, environmental issues are often addressed with quantitative approaches on physical measures, and thresholds. Along these lines, it is argued that society should impose constraints, in the form of floors or ceilings, on various 1 In a similar vein, Immanuel Kant (1724-1804) found it disconcerting that earlier generations should carry the burdens for the benefits of later generations. In his essay, "Idea for a Universal History with a Cosmopolitan Purpose," Kant put forward the view that nature is concerned with seeing that man should work his way onwards to make himself worthy of life and well-being.…”

“…2 The thresholds are interpreted as minimal rights to be guaranteed to all generations. Alvarez-Cuadrado and Long [1] examined the implication of a floor on consumption on the growth path of a society that optimally chooses its floor.…”

“…Our paper is related to the paper by Alvarez-Cuadrado and Long [1], which proposed a "Mixed Bentham Rawls Criterion" that seeks a trade off between a utilitarian indicator and the consumption level of the worse-off generation. If the latter is interpreted as a minimal consumption right, one may argue that the model of [1] is a special case of our model, where there are many minimal rights.…”

“…If the latter is interpreted as a minimal consumption right, one may argue that the model of [1] is a special case of our model, where there are many minimal rights. However, [1] did not refer to the above interpretation.…”