Políticas de rectificación de errores en la plataforma

I have responded to Freeman’s claim that market responsibility can only be determined

after the introduction of an external theory of justice. I argued that markets are necessary to hold people liable for the costs their choices, and for Dworkin’s baseline of true opportunity costs as a basis of neutral choice. I will now consider another recent

146

There is, of course, room for argument about whether Dworkin’s proposal for the true

opportunity cost baseline is the most neutral and equal one imaginable, an issue which is discussed the following section.

147

These transactions are not sacrosanct in the way that they are for libertarians. However, interfering with such transactions for the sake of the difference principle, or a socialist ideal of justice, is ruled out. The important difference is that ex ante hypothetical insurance decisions would, of necessity, be continuous with the values and desires of the individual, while ideals of just

distributions are not. Dworkin, Sovereign Virtue at 268-72, Dworkin, 'Foundations of Liberal

Equality', Williams, 'Equality for the Ambitious'. If all parties agreed that a particular distribution was crucially important, then they may wish to attempt to get closer to this through their private actions and agreements, for example by making an additional donation to the state or charity.

A discontinuous approach—one that did not fit in with the ethical ideals of those to whom it applies—would fail to show equal concern to all, and would violate the requirement of anti- perfectionism. The Rawlsian ideal is that institutions should be prejudiced towards the worst-off, whether or not the worst-off would have accepted such prejudice ex ante. However, the ex ante

approach allows people to choose for themselves what risks they wish to take in order to benefit themselves if they are among the worst-off. I will discuss this advantage of the ex ante approach in more detail in Chapter Four.

54 criticism of equality of resources provided by Joseph Heath. Like Freeman, Heath argues that it is possible to determine equality without utilising the market. However, instead of suggesting that another theory of justice is necessary in order to calculate just market prices, Heath criticises markets on a more fundamental level and proposes that an alternative approach would better fit with the envy-freeness ideal underlying equality of resources. The argument I gave in response to Freeman—that the aim of true opportunity costs is to provide as neutral as possible a basis from which people can make choices and pay the costs of those choices to the plans of others—is not an adequate response to Heath as he accepts the ideal of envy-freeness.

Joseph Heath challenged equality of resources as part of his complaint about a

catallactic bias within contemporary political philosophy.148 Heath is sympathetic to

148

By this he means a bias towards market trades and solely gains of this kind. Heath claims that this focus on gains from trade ignores other types of cooperative benefit, such as economies of scale, risk pooling, self-binding and information transmission; Heath, 'The Benefits of Cooperation ', at 319-28. Heath argues that social cooperation within society creates benefits that are overlooked as a realm of distributive justice. This is relevant because political philosophers tend to see the benefits of social cooperation as that which should be shared out according to the requirements of distributive justice, such as Rawls, A

Theory of Justice: Revised Edition at 4. The problem here, for Heath, is that the activities of

the state seem to be limited to redistribution for the purpose of efficiency. However, Heath suggests that the state also needs to provide and/or share out other benefits that are only available through cooperation; such as the provision of a social safety net in the case of risk-pooling, and the provision of national statistics and certification in order to ensure reliable information transmission.

I do not dispute that society produces more for its members than the “catallactic” benefits from trade. However, equality of resources is not explicitly organised around the distribution of gains from trade. This may be a crucial part of other liberal egalitarian theories, perhaps such as that of Rawls, but it does not play an obviously crucial role for Dworkin. The implication of Heath’s view seems to be that there are other gains from society that might not be shared out equally; or that certain sections of society—

presumably the wealthy—may be able to garner an unequal share of these advantages. In response to this I would point out that it may be possible for hypothetical-insurance-based taxation decisions to take account of any greater ease that some section of society has in benefitting from society. This is certainly not dismissed as a non-trade-related-gain. Where it is not possible to tax or otherwise utilise these benefits, it is not clear that any rival theory could take account of them either.

Nevertheless, there remains the claim that equality of resources is unable to justify the distribution of other forms of benefit that society can provide, and thus would insist that these forms of social benefit should not be provided or should be left within the

55 resource egalitarianism, and highlights that since the ideas of envy-freeness and “superfairness” have been discovered and rediscovered so many times they must be compelling.149 He writes that ‘the envy-freeness principle is very closely tied to the very simple and attractive idea that a just cooperative arrangement must be one that is acceptable to all.’150 This is indeed one way to look at it, but I will argue there is a further justification for the envy freeness standard—and of the integral place of private property and the market in distributive justice.

Heath explains the economics of envy-freeness, and demonstrates that there can be multiple “superfair” envy-free solutions, using the economic tools of an Edgeworth box and indifference curves,151 as depicted in figure 1-1.152 An envy-free situation, as I have said, is one in which nobody prefers the resources held by any other to their own—

purview of private interests. I think that this is untrue, however. For one thing, equality of resources would support intervention in laissez-faire markets that would reduce

imperfections, perhaps including the collection and dissemination of information such that everyone is in a fair position to be held reasonably responsible for their decisions. This would justify state provision of information for the benefit of all. Second, it is also not the case that hypothetical insurance decisions are limited to the provision of compensatory resources to individuals. Hypothetical insurance decisions may be more reasonable if they offer instead of compensation the use of public facilities or the provision of national services. These would have to be justified on a case-by-case basis, but they would take into account the factors that Heath claims are ignored by equality of resources. One example would be that the provision of a universal pension may be a sensible hypothetical insurance option in order to provide valuable security and avoid invidious comparisons.

149 _{Joseph Heath, 'Dworkin’s Auction', Politics, Philosophy & Economics, 3/3 (2004), 313-35 at 314-5.}

He points out that Hobbes appears to utilise the idea in Thomas Hobbes, Leviathan

(Harmondsworth, Eng.: Penguin, 1986 [1651]).

150 _{Heath, 'Dworkin’s Auction', at 316.} 151

Ibid. at 317-20.

152

This is taken from Heath (319). The point a illustrates that the distribution of commodities could be such that Person 1 has (10, 3) and Person 2 has (40, 7) (in this case, Person 2 would be much better-off than Person 1). The dashed lines are the indifference curves, which indicate the preferences of each Person for the two commodities. Point e is the point at which both have an equal amount of both commodities, at which there will by definition be no envy. Dworkin’s equal auction may result in a move from point e to point p. The curved lines running through point e are the no-envy lines for each Person. The shaded area with an “S” is the superfair region, in which both parties will prefer their bundle to that of the other. There will not always be such a region, and in a complex economy with many persons and many commodities it is hard to believe the multi- dimensional region would be more than tiny.

56 they are indifferent. Superfairness refers to a situation in which everyone actually

prefers their resources to those of everyone else.153

Heath argues that the existence of multiple envy-free solutions implies the need for further principles, in order to determine the best—or better—among the superfair solutions.154 Heath acknowledges that the most obvious is the Pareto-efficiency standard, which converts an envy-free starting position into a more efficient envy-free position. This is the process that Dworkin uses and which Heath takes to be his justification for the use of the market. In order to understand this process of efficient trading, Heath suggests we require reference to the Second Fundamental Theorem of Welfare Economics, which is that ‘every Pareto optimal allocation can be the equilibrium outcome of a competitive market, given some initial allocation of goods

153 _{Baumol and Fischer, Superfairness : Applications and Theory at 19.} 154

Baumol indicates that it is unlikely that there will be a unique solution in most cases. Person 1 Person 2 0 0 0 0 0 10 50 3 4 10 0 7 a e Com m o d ity y Commodity x p S

57 and resources. This shows that there is no conflict in principle between equality and the exchange of goods.’155 This allows us to move within the Edgeworth box from an equal allocation—e—to an efficient equal allocation—p, as depicted in figure 1.1.156 Heath’s most relevant criticism157 is that the auction is not the only means to achieving an envy-free solution, and it is not the best. Indeed, there are many possible envy-free solutions, a point familiar to readers of Dworkin who highlights that the auctioneer could convert all of the resources of the island into wine and eggs and still produce an envy-free result.158 The Dworkinian auction with equal counters helps to maintain and improve a pre-existing envy-free outcome based on equal counters. Heath takes Dworkin’s purpose to be determining the best envy-free approach, and argues that some will prefer an alternative envy-free solution to that produced by an equal auction.159 I imagine that he has in mind the sort of situation that I will describe between Mike and Mavis. Mike trades some of his sugar with Mavis for her whiskey such that both consider themselves better-off than they did previously—compared to each other and to their previous situation. However, while Mavis only has a slight preference for the post-trade situation, Mike feels he is much better-off.160 However, there were other trades of sugar and whiskey which Mike would have still considered worth making, which would have been superfair. Within the range of superfair outcomes, the chosen rate of trade appears better for Mike than Mavis, given that he would have happily accepted less if more were unavailable. According to Heath, there are no grounds within Dworkin’s market-based approach to conclude that any of these

155

Heath, 'Dworkin’s Auction', at 322.

156

Ibid. at 323.

157 _{I have picked out three other criticisms from Heath, which I think rest on a mistake. I will discuss}

these in footnote 171. Heath makes a further point that Dworkin’s position, since it invokes the Second Theorem, can be re-characterised in welfarist terms, and that—if so—it would have some problematic counterintuitive outcomes, Ibid. at 331. This relates to the criticism by Roemer and others, which I discuss in section 4.9.

158

Dworkin, Sovereign Virtue at 67.

159 _{Heath, 'Dworkin’s Auction', at 324-5.}

160 _{This could be accounted for economically in terms of a consumer surplus, but such comparisons}

58 superfair outcomes are fairer than another, and Heath proposes an alternative non- market process that he thinks would be able to make such distinctions.

Heath does not offer much by explanation of his procedure, but he references a section of Baumol’s book which describes sequential superfairness.161 Baumol suggests sequential applications of the superfairness approach in order to determine outcomes that are “more superfair” than others.162 This procedure works by taking the each party’s preferred superfair solution and using that as the two opposite corners of a smaller sub-region of the superfair region. The superfairness approach would then be applied within this smaller region, and this procedure could be repeated again. This multi-stage recursive process may not produce a single solution, but it might reach a limit point.163 This is an alternative to the auction procedure, which challenges equality of resources because it is a resource-based proposal which does not utilise the market. Indeed, Heath goes so far as to say that a ‘recursive application of the envy-freeness standard’ would be more consistent with Dworkin’s ‘insistence upon a monistic conception of equality.’164 If Heath is correct, it would appear that the market has a much less prominent role in resource equality than Dworkin makes out.

The problem with Heath’s argument is that he overlooks the reasons Dworkin offers for taking a market approach. Heath appears to focus solely on Dworkin’s original presentation of equality of resources, before later embellishment and clarification, and he reads this as having presented the market as the only approach that provides a unique envy-free solution. Admittedly, Dworkin did present the market as the solution to the problems of unfairness due to arbitrariness and oversimplification in choosing between envy-free alternatives.165 However, this is not the main reason for preferring

161

Baumol and Fischer, Superfairness : Applications and Theory at 64-70.

162 _{Ibid. at 65.} 163

Heath, 'Dworkin’s Auction', at 325.

164 _{Ibid. at 329. We might express this differently by suggesting that the approach better meets the}

anti-perfectionist starting principle, and the ideal of assignment responsibility.

165

59 the market-based approach. If the main determinant of fair distributions were that they were envy-free and unique, then Heath would be correct that the sequential approach is a possible alternative which could be considered to be as good—if not better—than a market-based approach.166

The question, therefore, is whether a market in which people pay the true opportunity costs of their resources is superior to sequential superfairness. I will therefore consider this approach. Heath does not mention that Baumol suggests that his proposal is ‘probably more pertinent for theory than for application,’ though Baumol suggested it could be useful for determining divorce settlements.167 As a proposal to indicate how to distribute resources in the real world, then, it appears to be a non-starter;168 Heath offers no further suggestions about how to utilise his alternative proposal. His point is therefore that the market is not the only possible way to calculate envy-freeness. This argument does not seem a problem for equality of resources, since equality of resources merely needs to claim that the market is the best known way of maintaining envy-freeness over time, and the only one known to be workable.169

166

Indeed, Dworkin wrote in his initial article that the market only enters as a tool for equality, and that it should be ‘abandoned or constrained…[if]…an entirely different theoretical or institutional device would do better.’ Ibid. at 112.

167

Baumol and Fischer, Superfairness : Applications and Theory at 64, 65.

168

One possible implication is that Heath thinks that sequential superfairness implies an ex post actual-envy-freeness approach, which I consider in section 4.6.

169

Even if it is not practically viable, it is still worth noting that it is not apparent that the sequential approach would hold people responsible for their choices over time in the same way that markets can. It strikes me as akin to a patterned conception of justice, in that it is not guaranteed that the envy-freeness will be maintained once people begin to use and trade their resources. Nozick,

Anarchy, State, and Utopia at 155-60. A year after the auction Bruce has less valuable resources than others because he has chosen not to produce what others value with his land and labour time. Equality of resources can justify the amount that Bruce has at this stage, but it is not clear how sequential superfairness could do so. It would have to distinguish between choices for which people should be held liable, and those for which they should not. An individual would then not be able to envy the consequences of choices made by others that were also available to her, but envy the choices of others that were not available to her. However, it is not clear how these consequences can be measured in non-market envy-free terms. Perhaps there is a way to do this, but neither Baumol nor Heath provide this, with Baumol explicitly suggesting sequential superfairness could only be applied to one-time-period problems such as divorce.

60 The auction is only one—illustrative—part of the theory of equality of resources. It is followed by people making decisions about what to do with those resources and bearing the costs of those actions. The principle of special responsibility therefore has a crucial role to play in the justification of the role of private property and the market, of which the auction stands as an illustration. Sequential superfairness might do well at producing an equal and anti-perfectionist outcome, but it may not be able to provide people with assignment responsibility over their lives, nor liability for the costs of their activities to others. Assignment responsibility implies property rights that allow people to use their equal share of resources as they see fit. I cannot see—and Heath does not explain—how it would be possible to apply his superfairness approach to the many