FLEURBAEY Marc

No summary available.

Because climate change affects the economy at different scales, quantifying its impacts is particularly difficult. However, understanding these impacts is essential to develop an appropriate response in terms of mitigation and adaptation. It allows us to set regional and global targets in light of the costs of inaction, and to prepare for adaptation by identifying future vulnerabilities. This thesis focuses on how the dynamics and distribution of climate change impacts affect the assessment of mitigation trajectories. First, I show that the dynamics of the climate system play an important role in understanding the resulting economic damages, which can increase the social value of carbon. In a second step, taking into account the heterogeneity of impacts across countries, I study the distributional effects of different emission trajectories. Finally, I show how spillover effects and structural change can modify the distribution of climate change costs, through the example of impacts on labor productivity.

No summary available.

No summary available.

Utilitarianism plays a central role in economics, but there is a gap between theory, where utilitarianism is dominant, and applications, where monetary criteria are often used. For applications, a key difficulty is to define how utilities should be measured and compared. Drawing on Harsanyi’s (1955) approach, we introduce a new normalization of utilities ensuring that: (i) a transfer from a rich population to a poor population is welfare enhancing, and (ii) populations with more risk-averse people have lower welfare. We study some implications of this “fair utilitarianism” for risk sharing, collective risk aversion, and the design of health policy. (JEL D63, D81).

No summary available.

No summary available.

How to evaluate and compare social prospects when there may be a risk on i) the actual allocation people will receive. ii) the existence of these future people. and iii) their preferences? This paper investigate this question that may arise when considering policies that endogenously affect future people, for instance climate policy. We show that there is no social ordering that meets minimal requirements of fairness, social rationality, and respect for people's ex ante preferences. We explore three ways to avoid this impossibility. First, if we drop the ex ante Pareto requirement, we can obtain fair ex post criteria that take an (arbitrary) expected utility of an equally-distributed equivalent level of well-being. Second, if the social ordering is not an expected utility, we can obtain fair ex ante criteria that assess uncertain individual prospects with a certainty-equivalent measure of well-being. Third, if we accept that interpersonal comparisons rely on VNM utility functions even in absence of risk, we can construct expected utility social orderings that satisfy of some version of Pareto ex ante.

Climate change threatens irreversible and dangerous impacts, possibly leading to extinction. The most relevant trade-off then may not be between present and future consumption but between present consumption and the mere existence of future generations. To investigate this trade-off, we build an integrated assessment model that explicitly accounts for the risk of extinction of future generations. Using the class of number-dampened utilitarian social welfare functions, we compare different climate policies that change the probability of catastrophic outcomes yielding an early extinction. We analyse the role of inequality aversion and population ethics. Low inequality aversion and a preference for large populations favour the most ambitious climate policy, although there are cases where the effect of inequality aversion on the preferred policy is reversed. This is due to the fact that a higher inequality aversion both decreases the welfare loss of reducing consumption of the current generation and also decreases the welfare gain of reducing the future risk of extinction.

No summary available.

No summary available.

We develop an integrated assessment model with endogenous population dynamics accouting for the impact of global climate change on mortality through five channels (heat, diarrhoeal disease, malaria, dengue, undernutrition). An age-dependent endogenous mortality rate, which depends linearly on global temperature increase, is introduced and calibrated. We consider three emission scenarios (business-as-usual, 3°C and 2°C scenarios) and find that the five risks induce deaths in the range from 160,000 per annum (in the near term) to almost 350,000 (at the end of the century) in the business-as-annual. We examine the number of life-years lost due to the five selected risks and find figures ranging from 5 to 10 millions annually. These numbers are too low to impact the aggregate dynamics and we do not find significant feedback effects of climate mortality to production, and thus emissions and temperature increase. But we do find interesting evolution patterns. The number of life-years lost is constant (business-as-usual) or decreases over time (3°C and 2°C). For the stabilisation scenarios, we find that the number of life-years lost is higher today than in 2100, due to improvements in generic mortality conditions, the bias of those improvements towards the young, and an ageing population. From that perspective, the present generation is found to bear the brunt of the considered climate change impacts.

No summary available.

We highlight a new paradox for the social evaluation of risk that bears on the evaluation of individual well-being rather than social welfare, but has serious implications for social evaluation. The paradox consists in a tension between rationality, respect for individual preferences, and a principle of informational parsimony that excludes individual risk attitudes from the assessment of riskless situations. No social evaluation criteria can satisfy these three principles. This impossibility result has implications for the evaluation of social welfare under risk, especially when the preferences of some individuals are not known. It generalizes existing impossibility results, while relying on very weak principles of social rationality and respect for individual preferences. We explore the possibilities opened by weakening one of our three principles and discuss the advantages and drawbacks of these different routes.

Utilitarianism plays a central role in economics, but there is a gap between theory, where it is dominant, and applications, where monetary criteria are often used. For applications, a key difficulty for utilitarianism remains to define how utilities should be measured and compared across individuals. Drawing on Harsanyi’s approach (Harsanyi, 1955) involving choices in risky situations, we introduce a new normalization of utilities that is the only one ensuring that: 1) a transfer from a rich to a poor is welfare enhancing, and 2) populations with more risk averse people have lower welfare. We embed these requirements in a new characterization of utilitarianism and study some implications of this “fair utilitarianism” for risk sharing, collective risk aversion and the design of health policy.

Climate change raises the issue of intergenerational equity. As climate change threatens irreversible and dangerous impacts, possibly leading to extinction, the most relevant trade-off may not be between present and future consumption, but between present consumption and the mere existence of future generations. To investigate this trade-off, we build an integrated assessment model that explicity accounts for the risk of extinction of future generations. We compare different climate policies, which change the probability of catastrophic outcomes yielding an early extinction, within the class of variable population utilitarian social welfare functions. We show that the risk of extinction is the main driver of the preferred policy over climate damages. We analyze the role of inequality aversion and population ethics. Usually a preference for large populations and a low inequality aversion favour the most ambitious climate policy, although there are cases where the effect of inequality aversion is reversed.

Both risk and l��expertise are subjects of rare richness, as confirmed by the vast literature on these issues. When they are crossed, the difficulties that each of them raises are reinforced. This book is the product of the sixth Pierre Duhem conference, which had as its theme: risk and expertise. It brings together the original texts of the economist Marc Fleurbaey and the philosopher Sven Ove Hansson, as well as the exchanges they had with the commentators Mikaël Cozic, Minh Ha-Duong and Emmanuel Henry. An introductory essay, by Alexandre Guay, completes the set.

Climate change-related mortality may strongly affect human well-being. By reducing life expectancy, it reduces the well-being of some infividuals. This may exacerbate existing inequalities: ex-ante inequality among people in different groups or regions of the world. ex-post inequality in experienced well-being by people in the same generation. But mortality may also reduce total population size by preventing some individuals from having children. This raises the population-ethical problem of how total population size should be valued. This paper proposes a methodology to measure te welfare effects of climate change through population and inequality change. We illustrate the methodology using a climate-economy integrated assessment model involving endogenous population change due to climate change-related mortality.

No summary available.

Deregulation, economic crisis, social tensions, democratic destabilization, war: will the period 1980-2030 replay the drama of 1890-1940, with the strong probability of being followed by environmental cataclysms sweeping everything in their path in the second half of the century? The situation seems more alarming every day, and it is intolerable to note the gap between the considerable possibilities, unequalled in the past, enjoyed by most societies around the world, and the poor performance of institutions and governments. Institutional failures and governance problems are everywhere, in both the private and public sectors. But we can do much better, we can build a better society. Drawing on the work of a global panel of social scientists, this manifesto proposes a vision based on a new way of thinking about and reforming our main institutional pillars: markets, business, social welfare policies and democratic deliberation mechanisms. It delivers a message of hope and a call to action, at a time when new threats to the future have arisen and the ideologies of the past century have been discredited. Neither the loss of illusions nor the rise of capitalism should justify an end to the quest for social justice. (Editor's summary).

This paper presents the International Panel on Social Progress and expounds key ideas from its first report, Rethinking Society for the 21st Century (Cambridge University Press, 2018). It emphasizes the importance of three dimensions of progress on which serious challenges need to be addressed: equity, freedom and sustainability. Addressing these challenges primarily requires reforming power and governance structures in the economy, society, and politics.

When considering the social valuation of a life-year, there is a conflict between two basic intuitions: on the one hand, the intuition of universality, according to which the value of an additional life-year should be universal, and, as such, should be invariant to the context considered. on the other hand, the intuition of complementarity, according to which the value of a life-year should depend on what this extra life-year allows for, and, hence, on the quality of that life-year, because the quantity of life and the quality of life are complement to each other. This paper proposes three distinct accounts of the intuition of universality, and shows that those accounts either conflict with a basic monotonicity property, or lead to indifference with respect to how life-years are distributed within the population. Those results support the abandon of the intuition of universality. But abandoning the intuition of universality does not prevent a social evaluator from giving priority, when allocating life-years, to individuals with the lowest quality of life.

No summary available.

No summary available.

No summary available.

No summary available.

We study the measurement of well-being when individuals have hetero- geneous preferences, including di_erent conceptions of a life worth living. When individuals di_er in the conception of a life worth living, the equivalent income can regard an individual whose life is not worth living as being better o_ than an individual whose life is worth living. In order to avoid that paradoxical result, we reexamine the ethical foundations of well-being measures in such a way as to take into account heterogeneity in the conception of a life worth living. We derive, from simple axioms, an alternative measure of well-being, which is an equivalent income net of the income threshold making lifetime neutral. That new well-being index always ranks an individual whose life is not worth living as worse-o_ than an individual with a life worth living.

Over the last four years, we have worked with a large, international, and multidisciplinary group of scholars and social scientists, in the preparation of the first report of the International Panel on Social Progress (IPSP) (Rethinking Society for the 21st Century, Cambridge University Press, 2018). The question this group set itself to answer was whether we can hope for better institutions and less social injustice in the world in the coming decades, given the ongoing trends.

No summary available.

No summary available.

No summary available.

No summary available.

No summary available.

This book builds upon the work of 300 international social scientists involved in the International Panel on Social Progress to propose both an overview of contemporary obstacles and roadblocks on the way of social progress and a vision as well as operational propositions with a view to create better societies based on core principles of human dignity, sustainability and justice.

No summary available.

We provide a general method for extending social preferences defined for riskless economic environments to the context of risk and uncertainty. We apply the method to the problems of managing unemployment allowances (in the context of macroeconomic fluctuations) and catastrophic risks (in the context of climate change). The method guarantees ex post fairness and pays attention to individuals' risk attitudes, while ensuring rationality properties for social preferences, revisiting basic ideas from Harsanyi's celebrated aggregation theorem (Harsanyi, 1955). The social preferences that we obtain do not always take the form of an expected utility criterion, but they always satisfy statewise dominance. When we require social preferences to be expected utilities, we obtain a variant of Harsanyi's result under a weak version of the Pareto principle, and a maximin criterion under a stronger Pareto requirement, whenever the ex post social ordering does not depend on people's risk attitudes. We also show how non-expected utility individual preferences can be accommodated in the approach.

No summary available.

This doctoral thesis focuses on the birth of the idea of social justice, an idea formulated for one of the very first times in France by the Saint-Simonians (1825-1832). More precisely, social justice emerged under certain material and intellectual conditions. Observing the progress made through industrialization, the Saint-Simonians showed that the means of production could be distributed to all. This constitutes the material condition. The spirit of the French Revolution, and especially the Declaration of 1789, created an egalitarian atmosphere: each individual should be able to improve his or her socioeconomic status. This constitutes the intellectual condition. The Saint-Simonian considerations of social justice are based on a specific criterion: capacity. The founding aphorism of the Saint-Simonian doctrine follows: "to each according to his ability, to each according to his works", an aphorism specifying the rules of allocation of means of production and distribution of rewards. The Saint-Simonian system was rooted in their desire to provide an equitable system of opportunity based on bank credit. Such considerations constitute St. Simonian social justice.

Climate change raises the issue of intergenerational equity, as catastrophes may unfairly affect some generations. As climate change threatens irreversible and dangerous impacts, possibly leading to extinction, one relevant trade-off may not just involve present and future consumption, but present consumption and the mere existence of future generations. This paper aims at identifying public policies that can reduce unfairness and strike a compromise between present and future generations when the potential impact of catastrophic climate change on the economy is accounted for.

Climate change raises the issue of intergenerational equity. As climate change threatens irreversible and dangerous impacts, possibly leading to extinction, the most relevant trade-off may not be between present and future consumption, but between present consumption and the mere existence of future generations. To investigate this trade-off, we build an integrated assessment model that explicity accounts for the risk of extinction of future generations. We compare different climate policies, which change the probability of catastrophic outcomes yielding an early extinction, within the class of variable population utilitarian social welfare functions. We show that the risk of extinction is the main driver of the preferred policy over climate damages. We analyze the role of inequality aversion and population ethics. Usually a preference for large populations and a low inequality aversion favour the most ambitious climate policy, although there are cases where the effect of inequality aversion is reversed.

We evaluate the introduction of various forms of antihypertensive treatments in France with a distribution-sensitive cost-benefit analysis. Compared to traditional cost-benefit analysis, we implement distributional weighting based on equivalent incomes, a new concept of individual well-being that does respect individual preferences but is not subjectively welfarist. Individual preferences are estimated on the basis of a contingent valuation question, introduced into a representative survey of the French population. Compared to traditional cost-effectiveness analysis in health technology assessment, we show that it is feasible to go beyond a narrow evaluation of health outcomes while still fully exploiting the sophistication of medical information. Sensitivity analysis illustrates the relevancy of this richer welfare framework, the importance of the distinction between an ex ante and an ex post approach, and the need to consider distributional effects in a broader institutional setting.

No summary available.

Utilitarianism is a prominent approach to social justice that has played a central role in economic theory. A key issue for utilitarianism is to define how utilities should be measured and compared. This paper draws on Harsanyi's approach (Harsanyi, 1955) to derive utilities from choices in risky situations. We introduce a new normalization of utilities that ensures that: 1) a transfer from a rich to a poor is welfare enhancing, and 2) populations with more risk averse people have lower welfare. We propose normative principles that reflect these fairness requirements and characterize fair utilitarianism. We also study some implications of fair utilitarianism for risk sharing and collective risk aversion.

While little agreement exists regarding the taxation of bequests in general, there is a widely held view that accidental bequests should be subject to a confi…scatory tax. We propose to reexamine the optimal taxation of accidental bequests in an economy where individuals care about what they leave to their offspring in case of premature death. We show that, whereas the conventional 100 % tax view holds under the standard utilitarian social welfare criterion, it does not hold under the ex post egalitarian criterion, which assigns a strong weight to the welfare of unlucky short-lived individuals. From an egalitarian perspective, it is optimal not to tax, but to subsidize accidental bequests. We examine the robustness of those results in a dynamic OLG model of wealth accumulation, and show that, whereas the sign of the optimal tax on accidental bequests depends on the form of the joy of giving motive, it remains true that the 100 % tax view does not hold under the ex post egalitarian criterion.

No summary available.

A premature death unexpectedly brings a life and a career to their end, leading to substantial welfare losses. We study the retirement decision in an economy with risky lifetime and compare the laissez-faire with egalitarian social optima. We consider two social objectives: (1) the maximin on expected lifetime welfare, allowing for a compensation for unequal life expectancies, and (2) the maximin on realized lifetime welfare, allowing for a compensation for unequal lifetimes. The latter optimum involves, in general, decreasing lifetime consumption profiles as well as raising the retirement age. This result is robust to the introduction of unequal life expectancies and unequal productivities.

No summary available.

In their letter “Social cost of carbon: Domestic duty” (5 February, p. [569][1]), A. Fraas et al. argue that regulations to limit greenhouse gas emissions in the United States should be evaluated in the light of the domestic benefits they provide instead of global benefits, as recommended by the Interagency Group on the Social Cost of Carbon (2010) ([ 1 ][2]). This idea, which has already been put into practice by some ([ 2 ][3]), may seem reasonable. However, climate change is a special case. No matter where a ton of carbon is emitted, it has the same impact on the atmosphere, and it ultimately leads to the same damages from climate change. As a consequence, if the United States avoids emissions, other countries will also benefit, just as the United States will benefit from other countries reducing emissions. If every country adhered to Fraas et al. 's proposal to focus only on its domestic benefits, all countries would end up worse off. This was demonstrated at the beginning of climate change economics ([ 3 ][4]). . This situation is similar to the prisoner's dilemma ([ 4 ][5]), in which prisoners in separate rooms are given the opportunity to betray each other in exchange for a reduced sentence. Betrayal offers a greater reward than cooperation, unless both prisoners cooperate. Given the rules of the scenario, all rational self-interested prisoners would betray one another, leading to an outcome worse than if they had cooperated. In the case of climate change, we are in a better position than the prisoners in one way: We can talk to each other and decide to cooperate. In fact, we did so already. In Paris, last December, 195 countries decided to hold “the increase in the global average temperature to well below 2°C above pre-industrial levels and to pursue efforts to limit the temperature increase to 1.5°C above pre-industrial levels, recognizing that this would significantly reduce the risks and impacts of climate change” ([ 5 ][6]). Meeting this goal will not be possible if every country focuses only on its domestic benefits. The Interagency Group on the Social Cost of Carbon is right to recommend using global benefits to evaluate mitigation projects and regulations, and every country that is not doing so should follow the lead. . 1. [↵][7]Interagency Working Group on Social Cost of Carbon, Technical Support Document: Social Cost of Carbon for Regulatory Impact Analysis Under Executive Order 12866 (White House, Washington, DC, 2013). . . . 2. [↵][8]1. P. Watkiss, 2. C. Hope. , Wiley Interdiscip. Rev. Clim. Change 2, 886 (2011). [OpenUrl][9][CrossRef][10]. . 3. [↵][11]1. W. D. Nordhaus, 2. Z. Yang. , Am. Econ. Rev. 86, 741 (1996). [OpenUrl][12]. . 4. [↵][13]1. E. Rasmusen. 1. A. W. Tucker. , “A two-person dilemma” (Stanford University, 1950), reproduced in Readings in Games and Information, E. Rasmusen , Ed. (Wiley-Blackwell, Oxford, 2001). . . 5. [↵][14]Paris Agreement, as contained in the report of the Conference of the Parties on its 21st session, FCCC/CP/2015/10/Add.1. [http://unfccc.int/meetings/paris\_nov\_2015/items/9445.php][15]. . [1]: http://www.

No summary available.

We provide a general method for extending social preferences defined for riskless economic environments to the context of risk and uncertainty. We apply the method to the problems of managing unemployment allowances (in the context of macroeconomic fluctuations) and catastrophic risks (in the context of climate change). The method guarantees ex post fairness and pays attention to individuals' risk attitudes, while ensuring rationality properties for social preferences, revisiting basic ideas from Harsanyi's celebrated aggregation theorem (Harsanyi, 1955). The social preferences that we obtain do not always take the form of an expected utility criterion, but they always satisfy statewise dominance. When we require social preferences to be expected utilities, we obtain a variant of Harsanyi's result under a weak version of the Pareto principle, and a maximin criterion under a stronger Pareto requirement, whenever the ex post social ordering does not depend on people risk attitudes. We also show how non-expected utility individual preferences can be accommodated in the approach.

No summary available.

No summary available.

The common practice consists in using a unique value of the discount rate for all public investments. Endorsing a social welfare approach to discounting, we show how different public investments should be discounted depending on: the risk on the returns on investment, the systematic risk on aggregate consumption, the distribution of gains and losses, and inequality. We also study the limit value of the discount rate for very long term investments. We highlight the type of information that is needed about long-term scenarios in order to evaluate investments.

We evaluate the introduction of various forms of antihypertensive treatment in France with a distribution-sensitive cost-benefit analysis. Compared to traditional cost-benefit analysis, we implement distributional weighting based on equivalent incomes, a new concept of individual well-being that does respect individual preferences but is not subjectively welfarist. Individual preferences are estimated on the basis of a contingent valuation question, introduced into a representative survey of the French population. Compared to traditional cost-effectiveness analysis in health technology assessment, we show that it is practically feasible to go beyond a narrow evaluation of health outcomes while still fully exploiting the technical sophistication of medical information. Sensitivity analysis illustrates the relevancy of this richer welfare framework, the importance of the distinction between an ex ante and an ex post-approach, and the need to consider distributional effects in a broader institutional setting.

No summary available.

No summary available.

Climate change raises the issue of intergenerational equity, as catastrophes may unfairly affect some generations. As climate change threatens irreversible and dangerous impacts (IPCC, 2014), possibly leading to economic collapse, the tradeoff is no longer between present and future consumption, but between present consumption and the possible future extinction of civilization (Weitzman, 2009). This paper aims at identifying public policies that can reduce unfairness and strike a compromise between present and future generations when the potential impact of catastrophic climate change on the economy is accounted for. It explores the impact of inequality aversion and the impact of the attitudes towards population size on optimal climate policy when that catastrophic risk is accounted for. We use an integrated assessment model which simulates the future joint evolution of the economy and the climate. The Response model is a dynamic optimization model (Pottier et al., 2015), which belongs to the tradition of compact integrated assessment models such as DICE. It combines a Ramsey-like macroeconomic module and a climate module, and can be used to determine the optimal climate objective by comparing mitigation costs and avoided climate damages. We account for the risk of extinction due to climate change, first by assuming an exogenous probability of extinction, then by assuming a probability of extinction that depends on the temperature and on the level of economic output. We assume that the states of the world where people are wealthy will show enhanced resilience to climate damages, and will therefore face a lower probability of extinction under a given level of climate damages. Integrated assessment models can reveal the policy implications of various normative choices through the use of social welfare functions. Ideally, social welfare criteria should (i) account for inequality aversion (it should thus differ from the utilitarian criterion, which does not account for the distribution of utilities), (ii) satisfy the Pareto principle (i.e. it should account for the preferences of individuals) and (iii) be separable (i.e. the situation of past generations should not impact the evaluation). The ‘Expected Prioritarian Equally Distributed Equivalent’ (Fleurbaey and Zuber, 2014) accounts for the inequality aversion of the social planner and respects a weak form of Pareto, but is not separable under risky prospects (but we will not consider past generations in our analysis). This criterion includes a critical level of consumption which can be interpreted as the level of subsistence. In order to reveal the impact of inequality aversion on optimal climate policy, we consider various isoelastic functions φ, which translate the inequality aversion of the social planner, and various isoelastic functions u, which translate the risk aversion of the social planner. Inequality aversion here relates to the average consumption by individual at time t. Preliminary results using Response in the certain case (with no risk of extinction), and using the standard discounted utilitarian criterion, show that the optimal policy (i.e. the timing of optimal abatement) is identical for equal discount rates r = ρ + ηg, whatever the values of the pure time preference rate ρ and the degree of inequality aversion η. In the risky case, the degree of inequality aversion has a significant impact on the optimal climate policy. In order to reveal the impact of the attitudes towards population size N (which refers to the total number of individuals in all generations), welfare is weighted by the population size through αN, which is a bounded increasing sequence of N. In this case, the criterion gives priority to large populations.

eHarsanyi (1955) proved that, in the context of uncertainty, social rationality and the Pareto principle impose severe constraints on the degree of priority for the worst-off that can be adopted in the social evaluation. Since then, the literature has hesitated between an ex ante approach that relaxes rationality (Diamond, 1967) and an ex post approach that fails the Pareto principle (Hammond, 1983. Broome, 1991). The Hammond–Broome ex post approach conveniently retains the separable form of utilitarianism but does not make it explicit how to give priority to the worst-off, and how much disrespect of individual preferences this implies. Fleurbaey (2010) studies how to incorporate a priority for the worst-off in an explicit formulation, but leaves aside the issue of ex ante equity in lotteries, retaining a restrictive form of consequentialism. We extend the analysis to a framework allowing for ex ante equity considerations to play a role in the ex post evaluation, and find a richer configuration of possible criteria. But the general outlook of the Harsanyian dilemma is confirmed in this more general setting.

Discounted utilitarianism and the Ramsey equation prevail in the debate on the discount rate on consumption. The utility discount rate is assumed to be constant and to reflect either the uncertainty about the existence of future generations or a pure preference for the present. The authors question the unique status of discounted utilitarianism and discuss the implications of alternative criteria addressing the key issues of equity in risky situations and variable population. To do so, they introduce a class of intertemporal social objectives, named Expected Prioritarian Equally Distributed Equivalent (EPEDE) criteria. The class is more flexible than discounted utilitarianism in terms of population ethics and it disentangles risk aversion and inequality aversion. The authors show that these social objectives imply interesting modifications of the Ramsey formula, and shed new light on Weitzman’s “dismal theorem”.

An early death is, undoubtedly, a serious disadvantage. However, the compensation of short-lived individuals has remained so far largely unexplored, probably because it appears infeasible. Indeed, short-lived agents can hardly be identified ex ante, and cannot be compensated ex post. We argue that, despite those difficulties, a compensation can be carried out by encouraging early consumption in the life cycle. In a model with heterogeneous preferences and longevities, we show how a specific social criterion can be derived from intuitive principles, and we study the corresponding optimal policy under various informational assumptions.

The common practice consists in using a unique value of the discount rate for all public investments. Endorsing a social welfare approach to discounting, we show how different public investments should be discounted depending on: the risk on the return of the investment, the systematic risk on aggregate consumption, the distribution of gains and losses, and inequality. We also study the limit value of the discount rate for very long term investments, and the type of information that is needed about long-term scenarios in order to evaluate investments.

No summary available.

This Guidance for Priority Setting in Health Care (GPS-Health), initiated by the World Health Organization, offers a comprehensive map of equity criteria that are relevant to health care priority setting and should be considered in addition to cost-effectiveness analysis. The guidance, in the form of a checklist, is especially targeted at decision makers who set priorities at national and sub-national levels, and those who interpret findings from cost-effectiveness analysis. It is also targeted at researchers conducting cost-effectiveness analysis to improve reporting of their results in the light of these other criteria. THE GUIDANCE WAS DEVELOP THROUGH A SERIES OF EXPERT CONSULTATION MEETINGS AND INVOLVED THREE STEPS: i) methods and normative concepts were identified through a systematic review. ii) the review findings were critically assessed in the expert consultation meetings which resulted in a draft checklist of normative criteria. iii) the checklist was validated though an extensive hearing process with input from a range of relevant stakeholders. The GPS-Health incorporates criteria related to the disease an intervention targets (severity of disease, capacity to benefit, and past health loss). characteristics of social groups an intervention targets (socioeconomic status, area of living, gender. race, ethnicity, religion and sexual orientation). and non-health consequences of an intervention (financial protection, economic productivity, and care for others).

No summary available.

The aim of this paper is to provide an assessment of individual uncertainty regarding length of life. We have collected original data through a survey performed in 2009 on a representative sample of 3,331 French people aged 18 or more. The survey design recorded several survival probabilities per individual, which makes it possible to compute (i) subjective life expectancy, defined as the first moment of the individual’s subjective distribution of personal longevity. (ii) the standard error of this distribution, which provides insight on the individual’s uncertainty regarding his or her own longevity. There is considerable between-individual variability in subjective life expectancies, in (small) part explained by age, illnesses, risky behavior, parents’ death and socioeconomic variables. The second main finding is that individual subjective uncertainty about length of life is quite large, equal on average to more than 10 years for men and women. It is logically decreasing with age, but apart from age, very few variables are correlated with it. These results have important consequences for public health and retirement policy issues.

Health equivalent income concept [.].

Marc Fleurbaey, economist and director of the Economics of Welfare and Social Justice Chair at the College of World Studies (FMSH), develops his current research on the theory of social justice, based on the work of John Rawls, and presents his future intellectual projects that include the participation of civil society.

We investigate the problem of how to perform comparisons of income distributions across families of different sizes. We argue that social welfare ought to be computed as the average individual utility instead of the average household utility as in most known criteria. We provide dominance criteria which allow for some indeterminacy about the average optimal family size, by resorting to the bounded approach to dominance analysis proposed by Fleurbaey et al. (2003). Indeed, when differences in needs come from family size, a specific population allocation problem (how a population should be optimally divided over families for given resources) adds to the usual income allocation problem. Pro-family and anti-family stances are introduced in order to make explicit the choice of an optimal family size. An application to French data shows that shifting from the household to the individualistic point of view can substantially alter the outlook of dominance results.

This paper examines how to satisfy "independence of the utilities of the dead" (Blackorby et al. in Econometrica 63:1303-1320, 1995. Bommier and Zuber in Soc Choice Welf 31:415-434, 2008) in the class of "expected equally distributed equivalent" social orderings (Fleurbaey in J Polit Econ 118:649-680, 2010) and inquires into the possibility to keep some aversion to inequality in this context. It is shown that the social welfare function must either be utilitarian or take a special multiplicative form. The multiplicative form is compatible with any degree of inequality aversion, but only under some constraints on the range of individual utilities.

Two methods are generally considered for the evaluation of health policies. The cost-benefit approach is based on the sum of individual willingness to pay: it respects individual preferences but gives priority to the preferences of the richest people because their willingness to pay is generally higher. The cost-effectiveness approach selects policies that provide the highest overall health gain for a given total cost. It does not benefit high-income individuals, but it may have other undesirable effects, such as favoring treatment of a minor condition that will benefit the most people over a major condition that affects few. A variant of cost-benefit analysis avoids these pitfalls. It consists of weighting the willingness to pay by coefficients that vary in the opposite direction to an indicator of individual well-being combining income and health status. The indicator chosen is health equivalent income: this is the individual's actual income minus the amount he or she would be willing to forego in order to be in perfect health. For a given income, it therefore decreases when health deteriorates. Unlike subjective utility indices, it has the advantage of being based solely on the ordinal preferences of individuals. This approach is implemented through a survey conducted on a representative sample of the French population. Given their financial constraints, low-income individuals attach less relative importance to their health status. However, the coefficients obtained nevertheless allow us to overweight the least privileged individuals who have a combination of low income, poor health and a strong preference for improving their health. These coefficients can then be used to evaluate any policy for which individual willingness to pay is known.

A premature death unexpectedly brings a life and a career to their end, leading to substantial welfare losses. We study the retirement decision in an economy with risky lifetime, and compare the laissez-faire with egalitarian social optima. We consider two social objectives: (1) the maximin on expected lifetime welfare (ex ante), allowing for a compensation for unequal life expectancies. (2) the maximin on realized lifetime welfare (ex post), allowing for a compensation for unequal lifetimes. The latter optimum involves, in general, decreasing lifetime consumption profiles, as well as raising the retirement age, unlike the ex ante egalitarian optimum. This result is robust to the introduction of unequal life expectancies and unequal productivities. Hence, the postponement of the retirement age can, quite surprisingly, be defended on egalitarian grounds --although the conclusion is reversed when mortality strikes only after retirement.

We compare two approaches to measuring inequity in the health distribution. The first is the concentration index. The second is the calculation of the inequality in an overall measure of individual well-being, capturing both the income and health dimensions. We introduce the concept of equivalent income as a measure of well-being that respects preferences with respect to the trade-off between income and health, but is not subjectively welfarist since it does not rely on the direct measurement of happiness. Using data from a representative survey in France, we show that equivalent incomes can be measured using a contingent valuation method. We present counterfactual simulations to illustrate the different perspectives of the approaches with respect to distributive justice.

We argue that the economic evaluation of health care (cost–benefit analysis) should respect individual preferences and should incorporate distributional considerations. Relying on individual preferences does not imply subjective welfarism. We propose a particular non-welfarist approach, based on the concept of equivalent income, and show how it helps to define distributional weights. We illustrate the feasibility of our approach with empirical results from a pilot survey.

No summary available.

Common sense supports prevention policies aimed at improving survival prospects among the population. It is also widely acknowledged that an early death is a serious disadvantage, and that attention should be paid to the compensation of short-lived individuals. This paper re-examines the compatibility of those two concerns: prevention against early death and compensation for early death. We show that, under mild conditions, no social ordering on allocations can satisfy a concern for prevention and a concern for compensation. The reason is that if it is socially desirable to raise the number of survivors through prevention, it must also be, under costly prevention, desirable to deteriorate the living standards of the short-lived. We then explore two approaches to the prevention/compensation dilemma, and study the associated optimal allocation of resources.

Recent developments in welfare economics open the way to evaluation methods based on other models of social justice than utilitarianism. The feasibility of these methods in the daily practice of evaluating health interventions raises questions: the objective of this thesis is to contribute to answering them. To this end, we have focused on three practical cases. The aim of Chapter I is to compare the evaluation methodologies of three public evaluation agencies, the NICE (Great Britain), the IQWiG (Germany) and the KCE (Belgium), in order to identify the social justice positions that result from them. Chapter II proposes to study the moral dilemma that arises from the phenomenon of preference adjustment in the evaluation of two disability compensation schemes. Three options are put forward to solve this dilemma, based on egalitarian theories of social justice. Finally, Chapter III demonstrates the feasibility of the health-equivalent income approach, developed by Fleurabey, in public decision support, concerning antihypertensive treatments in primary prevention.

Rawls' initial ambition is to present an analysis of distributive justice that is superior to the utilitarian conception, which, according to him, is incapable of providing a satisfactory basis for justice in a democracy. In order to do this, Rawls mobilized, in his main work Theory of Justice [1971], ideas imbued with Anglo-Saxon political and moral philosophy, but also with many concepts forged by economists. This work thus became an essential reference for contemporary political philosophy, but also for economic theories of social justice. Our thesis proposes to reconstruct Rawls' theory, whose numerous but fragmented studies have given rise to very contradictory interpretations. Studying the author's thought in the light of economics serves to give an overall coherence to justice as equity, from its genesis to its latest developments. This methodology, in fact, allows us to show that beyond the indeterminacy of the principle of difference - which can justify both an ultraliberal policy and a policy inspired by socialist ideals - the improvement of the situation of the most disadvantaged requires the overcoming of the capitalist system. This system is not capable of meeting the requirements of the principles of justice defended by Rawls.

After a review of the New Geographical Economics (NEG) literature on location choices and public policies in a globalized economy, we focus our analysis on three different geographical levels: cities, nations and the European Union. We will analyze successively some specific public economy issues at these different levels. First, we address the issue of tax competition: within the theoretical framework of NEG, we show, first, that a race to the bottom is to be feared between small jurisdictions, and second, that a policy of tax harmonization in the direction of a floor tax for peripheral countries - a policy recommended by NEG and envisaged by the European Commission - tends not to be Pareto optimal. Then the theme of corruption: we analyze how a central government that captures the rent generated by entrepreneurs in the sector with increasing returns reacts to a drop in commercial costs. In particular, we will see under which conditions the bad governance of a government (measured by the amounts embezzled), can follow an inverted U curve under the effects of trade openness. Finally, we study the European Union's trade preferences: we show that these preferences were relatively well used in 2001, particularly by sub-Saharan African countries. For several of these countries, the value of the preferences represented a significant proportion of their world exports.

This thesis consists of two parts. The first is a synthetic presentation of normative economics. It deals with social choice, the opposition between utilitarianism and egalitarianism, models of inequality, the critique of welfarism, the liberalism of Marxian exploitation, bargaining and the absence of envy. The second examines non-Walfarist theories of equality (Rawls, Sen. . . ). It begins with a three-chapter study of the problem of compensation for disadvantage. The fourth chapter returns to the philosophical aspects of the debate. The last chapter proposes an application to direct taxation, which focuses on individual budget sets.