Question

The Utilitarian specification of the social welfare function (SWF) generally leads to a higher level of redistribution than the Rawlsian specification of the SWF. True or false? Explain your answer.

Answer 1

The Social Welfare Function (SWF) refers to the state of the individual preferences of maximizing the social welfare by using the Utility level of preferences. Those Utility level of preferences are used as the comparing indicators of two individuals say A and B. The individuals are said to be part in the existing society. It can be determined by W = f(U₁, U_II).

Based on the above SWF two Specification theories were framed. by the Eminent Economic Scholars. Utilitarian Theory was framed by the Betham and the Rawlsian Theory was framed by the John Rawl.

Utilitarian Theory  was based on the philosophy and ethics. It was highly subjective and normative in nature. It was mainly propogates the pleasure of maximizing the social benefits in one end and reducing the pain in another end. It only considers only happiness and pleasure are the only parameters to attain the social welfare goal.

But the Rawlsian Thoery was based on practical situation oriented factors - Income and Wealth. It captures the function of Redistributing Income and Wealth to the people. So it is proved that rise in income leads to gradual increase in the Wealth.

So here we can conclude that Rawlsian Specification of SWF was very effective and higher level of of redistribution.

So the fact is False,