Interpersonal comparisons of utility: Why and how they are and should be made

Abstract

A satisfactory complete normative criterion for individualistic ethical decisionmaking under uncertainty such as Harsanyi’s (Journal of Political Economy , 1955) requires a single fundamental utility function for all individuals which is fully interpersonally comparable. The paper discusses reasons why interpersonal comparisons of utility (ICU’s) have been eschewed in the past and argues that most existing approaches, both empirical and ethical, to ICU’s are flawed. Either they confound facts with values, or they are based on unrealistic hypothetical decisions in an “original position”. Instead ICU’s need to be recognized for what they really are — preferences for different kinds of people. INTERPERSONAL COMPARISONS OF UTILITY . . . I still believe that it is helpful to speak as if inter-personal comparisons of utility rest upon scientiAEc foundations – that is, upon observation or introspection. . . . I still think, when I make interpersonal comparisons . . . that my judgments are more like judgments of value than judgments of veriAEable fact. Nevertheless, to those of my friends who think differently, I would urge that, in practice, our difference is not very important. They think that propositions based upon the assumption of equality are essentially part of economic science. I think that the assumption of equality comes from outside, and that its justiAEcation is more ethical than scientiAEc. But we all agree that it is AEtting that such assumptions should be made and their implications explored with the aid of the economist’s technique. — Robbins (1938, pp. 640–641)