7/23/2019 Reasons for Maximin
1/7
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merican Economic ssociation
Some Reasons for the Maximin CriterionAuthor(s): John RawlsSource: The American Economic Review, Vol. 64, No. 2, Papers and Proceedings of theEighty-sixth Annual Meeting of the American Economic Association (May, 1974), pp. 141-146Published by: American Economic Association
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2/7
CONCEPTS
OF
DISTRIBUTIONALEQUITY
o m e e a s o n s
o r
t h
Maximin
riterion
By JOHN RAWLS*
Recently
the maximin criterion of dis-
tributive equity has received
some atten-
tion
from
economists
in connection with
the problem
of
optimal
income taxation.1
Unhappily I am unable to examine the
merits
of the criterion
from the
standpoint
of economic theory, although
whether the
criterion
is
a
reasonable distributive stan-
dard depends importantly
on
the sort
of
examination
that only economists can
un-
dertake.
What
I
shall
do
is
to
summarize briefly
some of
the reasons
for
taking
the
maximin
criterion seriously.
I
should emphasize that
the maximin
equity criterion
and
the
so-
called maximin rule for choice under un-
certainty are two very
different things.
I
shall
formulate
the
reasons
for the
equity
criterion so
that
they
are completely inde-
pendent
from this
rule.
In
A Theory of Justice
I
have considered
the maximin criterion as
part
of
a social
contract theory.
Here
I
must assume
a
certain familiarity
with this conception.2
One feature
of it might be put this
way:
injustice exists
because basic agreements
are made too late (Richard Zeckhauser).
People already know their
social positions
and
relative
strength
in
bargaining,
their
abilities and
preferences, and
these con-
tingencies and knowledge of
them cumula-
tively distort the social
system. In an at-
tempt to
remedy this difficulty, contract
theory introduces the notion of the original
position.
The
most
reasonable principles
of
justice
are
defined as those
that would
be
unanimously agreed to in an
appropri-
ate initial
situation that is
fair between
individuals
conceived as free and equal
moral
persons.
In
order
to
define
the original position
as fair
in
this
sense, we imagine that every-
one
is deprived
of
certain
morally irrele-
vant information.
They
do
not
know
their
place in society, their class position or
social
status,
their
place
in
the
distribution
of
natural assets
and
abilities,
their
deeper
aims
and
interests,
or
their
particular psy-
chological makeup. Excluding this infor-
mation
insures
that no
one is
advantaged
or
disadvantaged
in
the
choice
of
princi-
ples by natural
chance or social contin-
gencies.
Since
all are in
this
sense
similarly
situated
and no one knows how to
frame
principles
that
favor
his particular
condi-
tion, each will reason in the same way.
Any agreement
reached
is
unanimous and
there
is
no
need
to
vote.
Thus the subject of the
original agree-
ment
is a
conception
of
social
justice.
Also,
this conception is
understood to
ap-
ply to the basic
structure
of
society:
that
is,
to its major institutions-the
political
constitution
and the
principal
economic
*
Professor of
philosophy, Harvard University. I
am
grateful
to Robert Cooter
and Richard
Zeckhauser
for
their
very
instructive
comments which enabled me to
improve these remarks
and saved me fronm
several
mistakes.
I
See
A. B.
Atkinson, Martin
Feldstein,
Y'oshitaka
Itsumi,
and Edmund S.
Phelps.
2
In economics
this sort of theory was
reintroduced
by James Buchanan and
Gordon Tullock.
I
A similar idea is
found in J.
C. Harsanyi (1953).
141
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3/7
142
AMERICAN
ECONOMIC ASSOCIATION MAY 1974
and social arrangements
and
how
they
fit
together
into one
system.
The
applica-
tion of the maximin criterion to optimal
income taxation is, then,
perfectly
in
order,
since
an income tax is
part
of the
basic
structure.
But
the
maximin criterion
is
not
meant
to
apply
to small-scale
situations,
say,
to how
a
doctor should treat
his
pa-
tients
or
a
university
its students.4
For
these
situations
different
principles
will
presumably
be
necessary.
Maximin
is a
macro
not
a
micro
principle.
I
should
add
that the criterion is unsuitable
for
deter-
mining the just rate of savings; it is in-
tended
to hold
only
within
generations
(Rawls,
sec.
44, pp. 291-92,
Kenneth
J.
Arrow,
1973a,
and Robert
M.
Solow).
But
what alternative
conceptions are
available
in the
original position? We
must
resort to
great simplifications
in
order to
get
our
bearings.
We cannot con-
sider
the
general
case where
the
parties
are
to
choose
among
all
possible conceptions
of
justice;
it is too difficult
to
specify this
class of alternatives. Therefore we imagine
that the
parties
are
given
a
short
list of
conceptions
between
which
they are to de-
cide.
Here
I
can
discuss
only
two
pair-wise
comparisons.
These
are
designed
to
reflect
the
traditional
aim of
contract
theory,
namely,
to
provide
an
account
of
justice
that
is
both
superior
to
utilitarianism and
a
more
adequate
basis
for
a
democratic
so-
ciety.
Therefore
the first choice is between
a
conception
defined
by
the
principle that
average utility
is
to
be
maximized
and
a
conception defined by
two
principles that
express
a
democratic
idea
of
justice. These
principles
read as follows:
1.
Each
person has
an
equal right to
the
most extensive scheme of
equal basic
liberties compatible with a similar
scheme
of
liberties
for all.
2. Social and economic inequalities are
to meet two conditions: they must be
(a) to the greatest expected benefit
of the least advantaged members of
society (the maximin equity cri-
terion) and (b) attached to offices
and positions open to all under coIn-
ditions of fair equality of opportu-
nity.
I assume that the first of these takes prior-
ity over the second, but this and other
matters
must
be left aside. (For more on
this, see Rawls, pp. 40-45 and 62-65.) For
simplicity
I
also
assume
that a
person's
utility
is
affected
predominantly by liber-
ties
and
opportunities, income
and
wealth,
and
their
distribution. I
suppose
further
that
everyone has normal physical needs
so
that
the
problem
of
special
health
care
does
not
arise.
Now
which of
these conceptions would
be chosen depends
on
how the persons
in
the
original position are conceived. Con-
tract theory stipulates that they regard
themselves
as
having
certain
fundamental
interests,
the
claims
of
which
they must
protect,
if
this
is
possible.
It
is
in
the name
of
these
interests that
they have
a
right
to
equal respect
and
consideration
in
the de-
sign
of
society.
The
religious
interest
is
a
familiar historical
example;
the
interest
in
the integrity
of the
person is another.
In
the
original position
the
parties
do not
know
what
particular
form
these interests
take. But they do assume that they have
such
interests
and
also
that the
basic
liberties necessary
for
their
protection (for
example,
freedom of
thought
and
liberty
of
conscience,
freedom
of
the
person,
and
political liberty)
are
guaranteed by
the
first
principle
of
justice.
Given
these
stipulations,
the two
princi-
I
This affects the force of Harsanyi's counterexamples
(Harsanyi, 1973).
I
Part
of the
justification
for these assumptions
is
given
by the
notion of primary
goods. See Rawls,
sec.
15. Of course, there are still difficulties (Arrow, 1973b,
1)
254).
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VOL.
64 NO. 2 CONCEPTS
OF
DISTRIBUTIONAL EQUITY
143
ples of justice would be chosen.
For while
the principle of utility may
sometimes
lead to a social order securing
these liber-
ties, there is no reason why it will do so in
general.
And even if the
principle
often
does,
it would be pointless
to run the risk
of encountering
circumstances when it
does
not. Put
formally, each
must
suppose
that
the marginal
utility
of
these fundamental
interests
is
infinite;
this
requires
anyone
in
the original position
to
give
them priority
and
to
adopt
the two
principles
of
justice.
This conclusion
is
strengthened when
one adds
that the
parties regard
them-
selves as having
a
higher-order
interest
in
how
their
other
interests,
even fundamen-
tal
ones,
are regulated
and
shaped by so-
cial
institutions.
They
think
of
themselves
as beings
who
can choose
and
revise
their
final
ends
and who must preserve their
liberty in these
matters. A free person is
not only
one who has final ends which he is
free
to pursue
or to
reject,
but
also
one
whose original allegiance
and
continued
devotion. to these ends are formed under
conditions
that
are
free. Since the two
principles secure these
conditions, they
must
be
chosen.
The second
pair-wise comparison
is
far
more difficult. In this case
the choice
is be-
tween the
two
principles
of
justice
and
a
variant
of
these principles
in
which
the
utility principle
has a
subordinate
place.
To
define
this variant, replace the second
principle by
the
following: social
and
eco-
nomic inequalities are to be adjusted so as
to
maximize average utility consistent
with fair
equality
of opportunity.
The
choice
between this variant
and the two
principles is more delicate because
the
arguments
from
liberty
can
no longer
be
made,
at
least
not
so directly.
The
first
principle belongs
to
both
conceptions,
and
so
the
operation
of the
utility
principle
is
hedged by
basic
rights as
well as
fair
equality
of
opportunity.
One reason
favoring
the two
principles
of
justice is this. From
the
standpoint of
the
original
position,
the
parties will
surely
be
very
considerably risk-averse;
if
we ask
how risk-averse, we might say not less than
that
of
most
any
normal
person. Of
course,
this is
extremely
vague;
but
if
we
assume
that utility is
estimated from the
stand-
point
of
individuals in
society and repre-
sents,
as
the classical
utilitarians
believed,
a
quantity
ascertainable
independent of
choices
involving risk,
then, given the
crucial nature
of
the
decision
in
the origi-
nal
position, the claims of
the utility prin-
ciple seem
quite
dubious. On the other
hand,
if we
suppose
that utility
is mea-
sured
from the
original position
and takes
account
of
risk,
the
utility
criterion may
not
differ
much from
maximin.
The stan-
dard
of
utility approaches
maximin
as risk
aversion
increases
without limit (Arrow,
pp.
256-57). So, either
way, the original
position
pushes
us
toward maximin. How-
ever,
in
weighing
the second
pair-wise
comparison,
I
assume
that, based on con-
siderations of risk aversion alone, there
is
a
significant
difference between
the two
conceptions. Thus
the problem is
to iden-
tify
other attractive
features of the maxi-
min
criterion that tip
the balance of
reasons
in
its
favor.
First,
much
less
information
is needed
to
apply
the
maximin
criterion.
Once
the
least-favored group
is
identified, it may
be
relatively easy
to
determine
which
policies
are
to
their
advantage.
By comparison
it
is
much more difficult to know what maxi-
mizes
average utility.
We
require
a
fairly
precise way of
comparing
the
utilities
of
different
social
groups
by
some
meaning-
ful
standard,
as well as a method of
esti-
mating
the overall
balance
of
gains
and
losses.
In
application this
principle
leaves
so much
to
judgment
that
some
may
reasonably
claim
that
the
gains
of
one
group
outweigh the
losses
of
another,
while
others
may equally
reasonably deny
it.
This situation
gives those favored
by
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144
AMERICAN
ECONOMIC
ASSOCIATION
MAY 1974
existing inequalities
an
opportunity
to ex-
ploit their advantage so that, as a
result,
inequalities are likely to be excessive, un-
derminingthe justice of the system.
A further consideration is this: a dis-
tributive criterion is to serve as a public
principle. Citizens generally shouldbe able
to understand t and have some confidence
that it is realized. Pattern criteria, those
that
require the actual distribution to ex-
hibit certain ascertainable features, do
well by the test of publicity. Of these,
strict
equality (equal division) is the
sharpest principle.
T
he trouble with pat-
tern criteria is that sharpness is not the
only desideratum, and they often have
little else to commend them. On the other
hand, the utility principle is not sharp
enough:
even if it were
satisfied,
there
could
be little
public
confidence that
this
is
indeed
the
case.
The
maximin
criterion
has sufficient sharpness;
at
the same time
it is
efficient while strict
equality
is
not.
Another
ground supporting the
maxi.
min criterion is based on the strains of
commitment: in
the original position the
parties
are
to
favor those principles com-
pliance
with
which should prove more
tolerable, whatever their
situation
in
so-
ciety turns out
to
be. The notion of a con-
tract
implies
that
one
cannot
enter
into an
agreement
that
one
will
be unable
to
keep.
By
this
test, also,
maximin
seems superior,
for the
principles
chosen would
regulate
social
and economic
inequalities
in the
basic structure of society that affect
people's ife-prospects.
These
are
peculiarly
deep
and
pervasive inequalities
and often
hard
to
accept.
Looking
first
at the situation
of
the
less
advantaged,
the
utility principle
asks
them
to view the
greater advantages
of
others
who have more
as
a sufficient
reason
for
having
still lower
prospects
of life than
otherwise
they
could be allowed. This
is
an
extreme
demand
psychologically; by
con-
trast, the maximin criterion assures the
less favored that inequalities work to their
advantage. The problem with maximin
would appear to lie with those who are
better situated. They must accept less than
what
they would receive with the utility
principle, but two
things greatly lessen
their strains
of
commitment: they are,
after
all,
more
fortunate and enjoy the
benefits
of that
fact;
and insofar as they
value
their
situation
relatively
in
compari-
son with
others,
they give up that much
less.
In
fact,
our
tendency to evaluate our
circumstances
in
relation to
the circum-
stances
of
others
suggests
that
society
should
be
arrangedso
that
if
possible all its
members
can
with
reason be
happy with
their situation. The
maximin
criterion
achieves
this
better than
the principle of
utility.
I
have noted several
reasons that sup-
port the
maximin
criterion:
very
con-
siderable
normal
risk-aversion
(given
the
special
features
of
the original position),
less demandinginformation requirements,
greater suitability as a public principle,
and weaker
strains
of
commitment. Yet
no
one
of
them
is
clearly decisive by itself.
Thus the question arises
whether there is
any consideration
that is
compelling.
I
want to
suggest
that
the
aspirations
of
free and
equal
personality point directly
to
the
maximin criterion.
Since the
principles
of
equal liberty
and
fair
equality
of
opportunity
are
common
to
both
alternatives
in
the
second com-
parison, some form of democracy obtains
when either alternative
is
realized. Citizens
are
to
view
themselves
as
free and
equal
persons;
social
institutions should be
willingly complied
with
and recognized
as
just.
Presumably, however, certain
social
and
economic inequalities
exist,
and
indi-
viduals'
life-prospects
are
significantly
af-
fected
by
their
family
and
class
origins, by
their
niatural
ndowments,
and
by
chance
contingenciesover
the course
of
their
lives.
We must ask: In the light of what principle
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VOL. 64
NO.
2
CONCEPTS
OF DISTRIBUTIONAL
EQUITY
14S
can free and equal
moral
persons permit
their relations
to
be
affected
by
social
fortune and
the natural
lottery?
Since
no
one deserves his place in the distribution of
talents,
nor his
starting place
in
society,
desert
is not an answer. Yet free
and
equal
persons
want the effects of chance
to
be
regulated by
some
principle,
if a
reasonable
principle
exists.
Now when
the maximin criterion
is
fol-
lowed, the
natural distribution
of
abilities
is viewed in some respects as
a
collective
asset.
While
an
equal
distribution
might
seem
more in
keeping
with the
equality
of
free
moral
persons,
at
least
if
the distribu-
tion were
a
matter
of
choice,
this
is not a
reason
for
eliminating
natural
variations,
much
less
for
destroying
unusual
talents.
To
the contrary, natural variations are
recognized as
an
opportunity, particularly
since they
are
often complementary and
form
a
basis
for
social
ties. Institutions
are
allowed
to
exploit
the
full
range of abilities
provided
the
resulting inequalities are no
greater than necessary to produce corre-
sponding advantages
for
the
less fortunate.
The same
constraint holds
for
the inequali-
ties
between
social
classes.
Thus
at
first
sight
the
distribution
of natural
assets
and
unequal life-expectations
threatens
the re-
lations between free
and
equal
moral
per-
sons.
But
provided
the maximin
criterion
is satisfied,
these
relations
may be pre-
served:
inequalities
are
to
everyone's ad-
vantage
and
those able
to
gain
from
their
good fortune do so in ways agreeable to
those less favored. Meeting
this
burden
of
proof
reflects
the value
of
equality.
Now the
maximin
criterion
would con-
form
to
the precept
from
each according
to his abilities,
to
each
according
to his
needs
if
society were
to
impose
a
head tax
on
natural
assets.
In
this
way income
in-
equalities
could be
greatly
reduced
if
not
eliminated. Of course, there are enormous
practical difficulties
in
such
a scheme;
ability may be impossible to measure and
individuals would have every incentive to
conceal their talents. But another difficulty
is the interference with liberty; greater
natural talents are not a collective asset in
the sense that society should compel those
who have them to put them to work for
the less favored. This would be a drastic
infringement upon
freedom.
But society
can
say
that
the better endowed may
im-
prove their situations only on terms that
help others. In this way inequalities are
permitted
in
ways consistent
with
every-
one's
self-respect.
I
have
attempted
a
brief
survey
of
the
grounds for the maximin criterion.
I
have
done
this because
historically
it has
at-
tracted little attention, and yet
it
is a
natural
focal
point between
strict
equality
and
the
principle
of
average utility.
It
turns out
to
have
a
number
of
attractive
features.
But I do not wish to
overempha-
size
this criterion:
a
deeper investigation
covering
more
pair-wise comparisons may
show
that some other
conception
of
justice
is more reasonable. In any case, the idea
that economists may
find most useful
in
contract theory
is
that of
the
original po-
sition. This
perspective
can
be
defined
in
various ways
and
with
different
degrees
of
abstraction
and some
of
these
may prove
illuminating
for
economic theory.6
REFERENCES
K.
J.
Arrow,
Rawls's Principle of
Just Sav-
ing,
Instit. for Math. Stud.
in
the Soc.
Sciences, Stanford, tech. rep. no. 106, Sept.
1973a.
Some Ordinalist-Utilitarian
Notes
on
Rawls's Theory
of Justice, J. Phil.,
May
1973b, 70, 254.
A. B.
Atkinson, How Progressive
Should In-
come
Tax
Be?
in
J. M. Parkin,
ed., Essays
in
Modern
Economics,
London 1973.
J. Buchanan and G.
Tullock, The Calculus of
Consent,
Ann
Arbor
1962.
6
See
Zeckhauser
for
an illustration
of
the
use
of
this
sort of
framework.
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M. Feldstein, On the
Optimal Progressivity
of the Income Tax,
Harvard
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Y. Itsumi,
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E.
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The
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Justice, Quart. J.
Econ.,
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87,
331-54.
J.
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of Justice,
Cambridge,
Mass. 1971.
R. M.
Solow,
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Equity and
Exhaustible
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103,
Cambridge,Mass.
Feb.
1973.
R.
Zeckhauser, Risk
Spreading
and Distribu-
tion, in
H. M.
Hochman and
G. E.
Peter-
son,
eds.,
Political Economics
of
Income
Distribution,
New York
1974.
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