By way of clarification: it is easy to oppose individual Pareto-efficient distributions… it’s more difficult to oppose every Pareto-efficient distribution.
E.g. if the possible distributions are (10,0), (9,9) and (9,10), it’s pretty easy to oppose (10,0) even though it’s Pareto-efficient. Indeed, many people would rank (9,9) above (10,0) even though (9,9) is Pareto-inefficient. But it’s tougher to prefer (9,9) to (9,10).
Of course, there are probably strong egalitarians who would prefer (9,9) to (10,9). Are such people necessarily crazy?
Crazy, evil, or just not understanding (at the instinctive level) that the figures in question are intended to represent absolute utility, with both social-emotional consequences and future implications already taken into account.
For many practical situations for which (10,9) may be used as a simplified model that extra 1 gives an actual loss in utilty.
I would only use the description ‘crazy’ once it had been explained in detail that:
No, we don’t mean you get 9 resources, your rival gets 10 and so you get laid less.
No, we don’t mean that your rival has greater resources now, and sowill be able to capitalise on that difference to further increase the discrepancy until he make himself your feudal lord.
While I acknowledge ignorance is a form of ‘crazy’, it would not be crazy to support (9,9) until such time as it can be demonstrated that these utility functions are actually the abstract ideals that is implied.
When someone says, “OK, the rich are getting richer and the poor are staying the same. This is not PE,” the problem is not solved by responding, “Well, just assume the numbers are utility values, and the problem disappears!” You cannot measure the utility (or especially the counterfactual utility) with any precision. So “They’re utilities!” as I’ve heard (and used) it, tends to be a hand-wavy manner of dismissing a potentially serious problem by assumption.
I think a lot of people stubbornly refuse to accept that such values represent utilities because that assumption requires a rather violent departure from reality and realistic measures. Nothing is ever measured or calculated in utilities, so if your model of PE denominates values in them, that model may be shiny and interesting and have lots of cool mathematical properties, but it ain’t very useful when we’re applying it to, say, income disparity.
Of course, there are probably strong egalitarians who would prefer (9,9) to (10,9). Are such people necessarily crazy?
Libertarian answer: “Crazy or evil, yes.”
Fred has a ‘Jesus’ machine. It is a machine that can take one fish and turn it into three units of foodstuff, where a fish usually has one unit.
Fred starts with three fish. I start with 9. It costs a fixed 0.5 units of food to transport between me and Fred, payable at the end of the month.
Sally the Senator, she’s neither crazy nor evil and she’s also good at basic arithmetic. She proposes a law that says I must give one fish to Fred for him to manufacture into three units of food. Fred is to split the produce between the two of us evenly.
Sally can see that this outcome will give 10, 9 to Fred and myself respectively, where without Sally’s coercion we would have got 9,9.
I don’t think libertarians have nearly as much to say about optimization as they do about regulation. The libertarian answer would be, If you and Fred want to work something out, fine, but Sally has no business telling either of you what to do with your fish.
I’d think the more realistic egalitarian opposition would be between, say, (100, 35) and (50,34), i.e. the very rich getting even richer while the poor stay still. There are probably a few who would hold the (10,9) < (9,9), but that’s much less realistic.
The real problem with PE is that it specifically determines the “fairness” of a marginal transaction, not the fairness of the actual distribution.
By way of clarification: it is easy to oppose individual Pareto-efficient distributions… it’s more difficult to oppose every Pareto-efficient distribution.
E.g. if the possible distributions are (10,0), (9,9) and (9,10), it’s pretty easy to oppose (10,0) even though it’s Pareto-efficient. Indeed, many people would rank (9,9) above (10,0) even though (9,9) is Pareto-inefficient. But it’s tougher to prefer (9,9) to (9,10).
Of course, there are probably strong egalitarians who would prefer (9,9) to (10,9). Are such people necessarily crazy?
Libertarian answer: “Crazy or evil, yes.”
Crazy, evil, or just not understanding (at the instinctive level) that the figures in question are intended to represent absolute utility, with both social-emotional consequences and future implications already taken into account.
For many practical situations for which (10,9) may be used as a simplified model that extra 1 gives an actual loss in utilty.
I would only use the description ‘crazy’ once it had been explained in detail that:
No, we don’t mean you get 9 resources, your rival gets 10 and so you get laid less.
No, we don’t mean that your rival has greater resources now, and sowill be able to capitalise on that difference to further increase the discrepancy until he make himself your feudal lord.
While I acknowledge ignorance is a form of ‘crazy’, it would not be crazy to support (9,9) until such time as it can be demonstrated that these utility functions are actually the abstract ideals that is implied.
When someone says, “OK, the rich are getting richer and the poor are staying the same. This is not PE,” the problem is not solved by responding, “Well, just assume the numbers are utility values, and the problem disappears!” You cannot measure the utility (or especially the counterfactual utility) with any precision. So “They’re utilities!” as I’ve heard (and used) it, tends to be a hand-wavy manner of dismissing a potentially serious problem by assumption.
I think a lot of people stubbornly refuse to accept that such values represent utilities because that assumption requires a rather violent departure from reality and realistic measures. Nothing is ever measured or calculated in utilities, so if your model of PE denominates values in them, that model may be shiny and interesting and have lots of cool mathematical properties, but it ain’t very useful when we’re applying it to, say, income disparity.
Crazy, evil, or the second player.
Fred has a ‘Jesus’ machine. It is a machine that can take one fish and turn it into three units of foodstuff, where a fish usually has one unit.
Fred starts with three fish. I start with 9. It costs a fixed 0.5 units of food to transport between me and Fred, payable at the end of the month.
Sally the Senator, she’s neither crazy nor evil and she’s also good at basic arithmetic. She proposes a law that says I must give one fish to Fred for him to manufacture into three units of food. Fred is to split the produce between the two of us evenly.
Sally can see that this outcome will give 10, 9 to Fred and myself respectively, where without Sally’s coercion we would have got 9,9.
I think the libertarian answer is “No comment”.
I don’t think libertarians have nearly as much to say about optimization as they do about regulation. The libertarian answer would be, If you and Fred want to work something out, fine, but Sally has no business telling either of you what to do with your fish.
That was my impression.
My libertarian answer is that you’ve just convinced the future Freds of the world to keep quiet about any Jesus capabilities they discover.
And if my illustration didn’t, then this one might!
I guess that’s the commie answer too. The relevant comparison is between (9,9) and (11,8), or maybe (100,1) depending on your rhetorical temperature.
I’d think the more realistic egalitarian opposition would be between, say, (100, 35) and (50,34), i.e. the very rich getting even richer while the poor stay still. There are probably a few who would hold the (10,9) < (9,9), but that’s much less realistic.
The real problem with PE is that it specifically determines the “fairness” of a marginal transaction, not the fairness of the actual distribution.