This course starts with the welfarist theory of distributive justice, contrasting the utilitarian, egalitarian and Nash product maximisation approaches, before applying it to the fair distribution and exploitation of scarce resources through prices or other tools. Modern concepts of fair division invented by microeconomists, like the Shapley value and the Competitive Equilibrium with Equal Incomes, are discussed in the second part of the course.

Lectures: 10 x 2-hour lectures

Tutorials: 10 x 1-hour tutorials

On campus

None

None

Reassessments are normally available for all courses, except those which contribute to the Honours classification. For non Honours courses, students are offered reassessment in all or any of the components of assessment if the satisfactory (threshold) grade for the overall course is not achieved at the first attempt. This is normally grade D3 for undergraduate students and grade C3 for postgraduate students. Exceptionally it may not be possible to offer reassessment of some coursework items, in which case the mark achieved at the first attempt will be counted towards the final course grade. Any such exceptions for this course are described below. 

■ To present rigorously the key microeconomic concepts relevant to social and political justice: individual and collective welfare, utilitarianism versus egalitarianism, equal opportunity, end-state versus procedural justice, incentive compatibility, and individual guarantees;

■ To review a variety of applications such as: the measurement of inequality by the Gini and other indices; the design of tax schedules; the limits of voting by majority or by tallying scores; the division of an estate after a bankruptcy or a divorce; the division of a piece of land; solving the tragedy of the commons;

■ To stress the logical limits of combining economic efficiency with the requirements of end-state and procedural justice, in particular individual incentives to reveal private characteristics;

■ To further develop problem solving skills which should enhance their employability.

By the end of this course students will be able to:

1. Describe and explain the difficulty of modeling rigorously a microeconomic problem of fair division, explain what simplifications are needed to reach 'stylised facts", and what logical incompatibilities remain in spite of this streamlining; 

2. Describe, explain and apply such versatile concepts such as the No Envy test, the Nash bargaining solution, the Shapley value, and be able to recognise their applications in a variety of contexts;

3. Critically analyse every day arguments about the (un)fairness of markets, the tensions between equality and efficiency, and other normative arguments pervading political economy debates;

4. Solve a variety of problems related to the above concepts and models. 

None