Relative Utilitarianism
Amrita Dhillon, Jean-François Mertens
Econometrica · 1999 · Volume 67 · Issue 3
Abstract
‘If empirically meaningful interpersonal comparisons have to be based on indifference maps, as we have argued, then the Independence of Irrelevant Alternatives must be violated. The information which enables us to assert that individualAprefersxtoymore strongly thanBprefersytoxmust be based on comparisons byAandBofxandynot only to each other but also to other alternatives.Kenneth J. Arrow, ‘Social Choice and Individual Values, p. 112. In a framework of preferences over lotteries, we show that an axiom system consisting of weakened versions of Arrow's axioms has a unique solution. ‘Relative Utilitarianism’ consists of first normalizing individual von Neumann-Morgenstern utilities between 0 and 1 and then summing them.
Keywords
Axiomatization, social change, social welfare function, utilitarianism, welfarism, Arrow's Impossibility Theorem, expected utility.
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