Question

Consider the following scenario in the state of Taxopia.

One family has annual income of $190,000, while another family has an annual income of only $30,000. Under what circumstances would this outcome be considered unfair in terms of the process view of fairness?

The family with the higher income is headed by a person who is highly educated and has several degrees, whereas the family with the low income is headed by someone with just a high school education.

The primary income earner in the family with the high income has a high-paying job that requires significant skills, whereas the primary income earner in the family with the lower income has a low-skill, low-paying job.

In the family with the high income, both spouses work, whereas the family with the lower income relies on Social Security payments.

The family with the higher income runs a thriving business but receives a significant amount of government income transfers and tax breaks.

Answer 1

Process view of fairness look at the process through which an outcome is attained rather than looking at the final outcome itself.

It examines whether each party has been treated in fair manner through out the process and given the equal chance of attaining beneficial outcome or not.

In the given case, one family has higher income while other has lower income.

From perspective of the process view of fairness, this outcome can be considered fair if both families get equal chance to earn higher income but one family based on its ability or skills earn higher income than others.

However, if both families have same skill set but one family earns higher income due to outside intervention in terms of wealth endowment or government transfers then such scenario would be termed as unfair in terms of process view of fairness.

Hence, the correct answer is the option (d) [The family with the higher income runs a thriving business but receives a significant amount of government income transfers and tax breaks].