We talked about Ronald Dworkin’s novel argument for markets. Markets are essential for equality, according to Dworkin. Well that’s surprising!
Akshata kicked things off by asking why the view Dworkin opposed is called equality of “welfare.” When she thinks of welfare, she thinks of a shortish list of basic human needs.
Me too. I blame economists. In their defense, they’re usually interested in describing behavior. For that purpose, there isn’t a difference in kind between desires and needs: both (usually) motivate people to act. Where things have gone oddly, in my opinion, is when we turn to normative assessments. When we ask what society should provide (or what people should secure first), I think there’s an enormous difference between needs and satisfied preferences.
We’ll talk about this more when we get to the capabilities approach in November.
Brendan and Prof. Brown showed that the auction was vulnerable to strategic bidding. That is, bids that are designed to obscure the price that the bidder is willing to pay to force a more favorable offer.
We didn’t really show that this would have significant consequences for Dworkin’s project. But it seems that it should. Maybe there’s more here to reward thorough digging.
Amadé and Blessing both thought the auction required unrealistic amounts of information. Who knows their ambitions in life at one point in time? Maybe that’s an argument for markets as an actual social institution, rather than just as a thought experiment involving clam shells.
We left with some questions about the relationship among three things: the envy test, the hypothetical insurance markets, and the difference between brute and option luck. We’ll resume with those questions on Wednesday.