THE VARIOUS ANGLES OF APPROACH

We have seen that the facts about macrojustice, the relevant unanimous views, and the structure of impartiality required by conceptions of justice, entail that distributive justice in macrojustice has a structure of equal labour income equalization (ELIE). There remains to determine and realize the degree of community, redistribution, solidarity, or reciprocity: coefficient k. Chapter 17 has shown various basic aspects of this number and of the realization of the corresponding distribution. We now turn to the philosophy and the techniques of its determination. Endogenous social choice requires that the solution be derived from the views of society and of its members. The approaches to this determination are amenable to a dual division concerning, respectively,“who” evaluates and what is primarily evaluated. On the one hand, the evaluation can be seen as collective, cultural, sociological, and the result of the public ethos and debates; or it can be seen as made by the individual members of society. On the other hand, coefficient k can directly result from the view about global aspects of the society such as its degree of community or solidarity, or of individualism; or it can result from judgments about the interpersonal distribution of income or welfare, given that this distribution has the structure of an ELIE for the indicated reasons. These approaches, however, join one another when they are sufficiently deeply worked out.

SUMMARY

The foregoing has led to the conclusion that global distributive justice should focus on the allocation of rights in capacities. The present chapter will conclude that two types of rights in capacities should be self-owned – owned by their holder, or “naturally” allocated. They are the rights to use and benefit from the use because of process-freedom, and all the rights in eudemonistic and consumptive capacities for the specific issue of global distributive justice in macrojustice. These are the respective topics of Sections 2 and 3. The distribuand will then be restricted to the rent of productive capacities, whose allocation is considered in Parts II and IV of this study.

RIGHTS IN CAPACITIES

Types of rights in assets

The analysis of process-freedom has shown that it has specific implications as concerns the allocation of rights in capacities. The consideration of possible rights in capacities to begin with rejoins this conclusion.

A person's capacity is a set of characteristics of this person. It has the nature of an asset. Rights concerning an asset can be divided into several categories defined by the permitted use of the asset or by advantages derived from it. The relevant distinction considers four types of rights in an asset: the right to destroy; rights to use (without destroying) or use-rights rights to receive the benefits from this use or benefit-rights and rights to the value of the availability of the services this asset can provide or rent-rights.

THE GENERAL THEORY

Presentation and summary

Two states are “individualistically equivalent,” or, for short, “equivalent,” when all individuals are indifferent between them (unanimous indifference). The “principle of equivalence” consists of considering properties in states equivalent in this sense to the actual one. Given that the actual state has to be possible, and may be required to have some desired properties, some other properties may be better satisfied in other, equivalent states, or may be satisfied, or even defined, only in such states. These other properties may for instance be lower inequalities in goods or in freedoms, or equalities, or the highest sum of some valued item, and the actual state is often required to be Pareto efficient. The present chapter considers this theory and its applications (and in particular possible applications to global distributive justice). Section 1 presents the general theory and Section 2 the applications.

The philosophy of the equivalence principle, and notably the limit and possibility of its justification, are first considered (Section 1.2). One then notes the previous cases of application of this theory (Section 1.3), and the important property that non-Pareto-efficient states equivalent to a Pareto-efficient one have to be impossible (Section 1.4). The general theory of equivalence is then outlined in Section 1.5 and formally worked out in Section 1.6. The basic idea consists of taking, as specification of the levels of individual ordinal utilities, parameters for which some required properties are meaningful, such as equality, highest sum (in surplus theory), or lower inequality.

MACROJUSTICE AND MORAL ECONOMICS

The fifth and last part of this study compares the obtained result with normative principles that have been or can be proposed in the framework of economics. These principles are either aspects or cases of the obtained result (e.g., market liberalism, self-ownership, income egalitarianisms, social maximand functions), complements to it (for applications in the fields of microjustice or “mesojustice”), or, possibly, alternative proposals. Hence, the scope of the considered ideas is extensive. The focus here, however, is on their meaning, rather than on technicalities whose relevance fully depends on this meaning in the first place. The resulting survey of meanings of normative economic ideas, principles, or criteria probably has an interest in itself. There is, for instance, a close consideration of the various aspects of freedom (social, defined by a priori domains of choice, “natural” as socially unruly, or as various concepts and types of opportunity, rights, desert or merit from action, or responsibility); of the various meanings, uses, and properties of the concept of “utility” (happiness, satisfaction, lower pain, preference, choice, transitivity, comparabilities of various types); and of the rationally necessary structures of distributive principles (permutability, prima facie or ideal equality, lower inequality, benevolence), with their scope of application. Indeed, each principle or criterion should be accompanied by a clear and justified statement of the assumed meaning of the concepts it uses and of their properties, and of the proposed scope of application.

PRESENTATION: TWO POLAR VALUES AND INTERMEDIATE ONES

Chapter 23 emphasized the general structural properties of distributive principles. The present chapter focuses on issues concerning their “substance,” their material, or their basic concern. For individualistic principles, this material belongs to one of two broad families: freedom and possibilities, on the one hand, and happiness, satisfaction, or just preference, on the other hand. Both have held a central place in the normative side of economics for centuries, and, on the whole, freedom, with liberalism, has probably been the most important. Freedom is directly relevant – and, indeed, essential – for macrojustice. It has thus been discussed in Part I of this study for this application, and more broadly in Chapter 22 for comparison with various brands of economic thought. The present chapter is thus restricted, for both fields, to briefly pointing out the main applications, and to discussions of critical points, notably the interpersonal comparisons of freedom and of happiness that are, by logical necessity, required by the corresponding principles.

Indeed, we have seen that principles of justice require the interpersonal comparability of their basic concerns, whether they are the items or their variations, by logical necessity. Equality across individuals has to be considered across states for defining the basic property of nondiscernable permutations, in the same state for defining the ideal equality, and in comparing various states when differences in individual items across states are relevant.

PROCESS LIBERALISM

“This is mine because I made it or bought it with well-earned money”: This view expresses the common sentiment about distributive justice that underlies and founds the moral theory of process liberalism. There, legitimate ownership results from action, basically from free action. The “well-earned” qualificative indicates the time-regressive structure of the theory. Note, however, that people have neither made nor bought their own given capacities with which they produce or earn.

Process liberalism is a moral theory in social ethics, which is the moral valuation or hypostasis (or moral secular enshrinement) of process-freedom; that is, it consists of holding that individuals should be free to act and benefit from the consequences of their acts without forceful interference. Process liberalism has an important place in almost all societies because it defends a basic freedom and right. Moreover, process liberalism is the basic and central social-ethical theory of the modern world, a place and role it has been holding for the last couple of centuries. It is demanded by the classical “basic rights”, notably under the form of the respect of property. The full process-freedom it wants amounts to social freedom, although in focussing on some aspects and some applications, notably in the field of the economy. It will shortly be reminded that a consequence of process-freedom is the legitimacy of property rights acquired according to its rule, and of the corresponding free exchanges and free markets.

DIALOGICAL ETHICS

Consensus, information, communication, dialog

Endogenous social choice endorses the views common to the members of the considered society provided they are sufficiently informed and reflective (and other people's rights are respected). When these people disagree, they usually begin by discussing, trying to convince one another in exchanging information about facts, reasons, and values. This sometimes suffices to produce a consensus; at least, it often makes views and preferences closer to one another. Moreover, full relevant information is necessary for an ethical view which cannot rest on ignorance, mistaken beliefs, confusion, and misunderstanding. And, for social and notably distributive issues, full relevant information of an individual implies information about others that a priori only these others have. This may include knowing others' interests and situations, but it also includes information about others' views: formative information is about the reasons and other causes of others' social and ethical preferences, and empathetic information is about knowing others' corresponding feelings including feeling how they feel (Chapter 18). This essential information about others generally has to come directly or indirectly from them. Hence, communication involving society members has a basic role.

Therefore, the information transmitted is about facts, reasons, and also sentiments and feelings. The communication has to be mutual and reciprocal. It also generally takes an iterative form. Indeed, the information individuals want to transmit to others depends on what they know about others' information and judgments, as well as on their own information and judgments.

THE GENERAL CASE

The formalization of labour and productivity set up in Chapter 8 permits the precise presentation of the logic of the properties discussed in Chapter 7, in cases more general than those where labour is representable by a quantity or duration (possibly adjusted for differences in other characteristics) and output is proportional to it, which were the focus of Chapter 9. This is the topic of the present section, whereas Section 2 comes back to the case of unidimensional labour, but with a general production function, a case which will find an application in the treatment of involuntary unemployment in the next chapter.

The solution

Individuals in number n indexed by i each have a labour denoted as a set ℓi of chosen characteristics. Individual i working ℓi earns pi(ℓi, where pi is her production function. We have pi(0) = 0 (ℓi = 0 means that there is no labour: its duration is zero and the other characteristics are undetermined).

The obtained distributive justice consists of the equal sharing of the rent-rights in given productive capacities, that is, of the value of the production functions pi(). The value of these functions consists of the fact that they yield both income for labour and leisure for the labour necessary for obtaining a given output or income. This distributive allocation can only be in terms of the goods considered in the problem: income (or consumption goods) and leisure.

MODELING LABOUR

Characteristics and capacities

Equal labour income equalization can be presented with more or less complex (and complete) or simple models of the economy. Simple models may provide good descriptions, or sufficient approximations, in a number of cases. They can also be useful for focusing the presentation and discussion on crucial properties, or for didactic or illustrative purposes. The crucial issues will be the description of labour, the structure of individuals' production function showing earnings as a function of labour, and the situation of the labour market (notably, the absence or presence of involuntary unemployment). The present chapter focuses on the question of the description of labour and of the structure of the production function. It thus constitutes a preliminary for the following chapters that use its conclusions. It contains no ethical consideration – and hence, can possibly be skipped at first reading. However, its considerations are necessary for justifying formulations of labour that are usual, or that are used in the following chapters. For instance, can one speak of a “quantity of labour” or an “amount of labour”? What does this mean? What does an expression such as “she works twice as much” mean? If labour is measured by its duration, these expressions can make sense. One can then easily introduce the consideration of the speed of labour, all the rest remaining the same (if that is possible).

IMPORTANCE AND METHOD

Place and general method

In the foregoing analysis, the distinction of issues and remarks about their relative importance, associated with principles of unanimity and impartiality (and hence, of the relevant equality), have led to the conclusion that global distribution should have a structure of equal labour income equalization (ELIE). Individuals should equally share their product of the same “equalization labour” k – obtained with their different given capacities. The corresponding distributive transfers should amount to the implementation of this principle. This equalization labour or coefficient k is rich in very important meanings: it turns out to be, for the considered society, a degree of redistribution (from full self-ownership); of income equalization; of solidarity for facing the unequal natural distribution of capacities; of community in rights to resources; of labour reciprocity (the redistribution amounts to each individual yielding to each other the product of the same labour, or to each owning this product of each other);of income compensation for lower productivity; and of decrease in disparities in individuals' total incomes. Coefficient k will also turn out to be the minimum guaranteed income for individuals not responsible for their low income, as a fraction of the average wage.

The determination of this coefficient k is shown in the present part of this study. This will complete the determination of the required global distribution, and hence also, in adding the other applications of basic rights, of macrojustice in society.

INTRODUCTION AND SUMMARY

Income distribution is one of the most considered issues in judgments about overall distributive justice. These judgments often complain about income inequality and approve of its reduction. Moreover, a main tool for overall distributive justice, the income tax, is based on actual incomes and its progressivity is commonly justified as a means of reduction of inequalities in disposable incomes. This describes an ideal of equal disposable individual incomes (hence, household incomes are adjusted for family size). This ideal happens to discard a relevance of eudemonistic capacities; this is another manifestation of this general view about macrojustice (see Chapter 6).

This ideal also discards a relevance of differences in individuals' earnings for the distribution of disposable incomes. However, earnings depend on both labour and productivity. Then, these income egalitarians state that individuals' disposable incomes should not differ because of differences in productive capacities. But when it comes to the possible effects of labour, the view of most present-day income egalitarians is that someone who works more than someone else (longer, harder, at more painful or dirtier jobs, etc.) deserves a compensation for this extra work. This compensation is an extra income that compensates the painfulness of this extra labour (including foregone leisure). It a priori refers to a concept of indifference for an individual (but this is not the interindividual comparison of individual satisfactions or of their variations, which are found irrelevant for macrojustice).

INTRODUCTION

The obtained result – namely, the distinction of macrojustice, social freedom, the ELIE distributive scheme and, in the next part, the degree of redistribution – is derived from endogenous social choice and unanimity, along with facts and basic rationality. This result is thus obtained deductively rather than comparatively. It does not see itself as some “preferred solution.” It derives from the observation of people's well-considered preferences, rather than from some moral preference of some exogenous “ethical observer” (except if she chooses to respectfully rely on people's own appropriate preferences). In particular, the ELIE distributive scheme so results from unanimity and the corresponding efficiency, and from social freedom and the classical basic rights which, at any rate, constitute the basis of modern constitutions and – one can say – modern social ethics. This constitutes its reason and justification. However, and as a consequence, it presents a number of specific (and remarkable) properties which have, in themselves, ethical meaningfulness or practical value. Yet, a number of other distributive schemes are applied or proposed by scholars or policy makers. Some are relevant for issues in microjustice or mesojustice, rather than in the field of macrojustice. However, others are applied or proposed definitely for the question of macrojustice or for occupying its field. It is probably interesting to compare these solutions and schemes to the obtained one, both for enlightening the logic of the question in providing comparisons, frame, and possibly alternatives, and for choosing actual policies.

Presentation

The rest of Part I of this study completes the reasons and presents the sequence of implications that lead to the structure of global or overall distribution analyzed in Part II. There will be two kinds of items: social freedom and resources.

Social freedom means that there is no relation of force among individuals, including when they act in groups or in institutions. This indeed amounts to each individual being free from any other individual's forceful interference. This freedom is thus defined by (or as) a type of social relation, rather than a priori by a domain of possible choice or action – hence the adjective “social.” Social freedom also means that all individuals agree about what is done, although an individual may have to buy others' acts or others' agreements to her acts, in exchange for something. The respect of others includes that of the intended consequences of their acts, and hence of rights obtained in previous free actions or exchanges. Social freedom is commonly considered under two forms: the classical “basic rights” or “basic freedoms” (which are the basis of “democratic” constitutions), and the theory of free exchanges and the resulting property (notably through markets) approved of by “process liberalism.” We will see that social freedom can notably be justified as unanimously desired, given the relevant desires and possible uses of this liberty (this chapter and, particularly, Chapter 4).

INTRODUCTIVE SUMMARY

Justice should probably be seen as a palliative to the insufficiency of the deeper human values that are the choice of one's desires and concern for others. Among the multifarious questions of justice raised in society, macrojustice is concerned with the basic rules of society and the global or overall distribution of goods and of the main resources these rules imply. The specific solution for macrojustice will be shown. This will be the solution that is desired by society, in the sense that all its members unanimously want it when they are sufficiently informed, reflective, and impartial (a property of any view about justice). This will turn out to both imply and be implied by the fact that the general rule of society is social freedom, that is, an absence of relation of force between society members: each individual is free from the forceful interference of others individually or in groups or institutions (except possibly for protecting or realizing others' such freedom). Social freedom is generally presented in the form of the classical basic rights – the basis of democratic Constitutions. Social freedom or, more directly, unanimity, will imply that the overall distribution of resources has a very simple and meaningful structure (“equal labour income equalization”). There will, however, remain to determine a degree of equalization or redistribution, about which the interests of some individuals are opposed. The methods for solving this problem again involve some consensus.