Why Paretians Can't Prescribe: Preferences, Principles, and Imperatives in Law and Policy

Abstract

Recent years have witnessed two linked revivals in the legal academy. The first is renewed interest in articulating a normative master principle by which legal rules might be evaluated. The second is renewed interest in the prospect that a variant of Benthamite utility might serve as the requisite touchstone. One influential such variant now in circulation is what the Article calls welfarism. This Article rejects Paretian welfarism and advocates an alternative it calls welfare. It does so because Paretian welfarism is inconsistent with ethical, social, and legal prescription, while fair is what we have been groping for all along. Guido Calabresi was more right than we knew when he famously pronounced Pareto pointless. In fact it is anti-prescriptive. The Article first explicates the nature of and social welfare, then their relations to the sundry Pareto criteria. It observes that ethical, social and legal prescription always draw a cut between bona fide and proscribed satisfaction. They do so, moreover, on the basis of precisely those preference-incumbent distributive principles that Paretian criteria rule out. The Article next explicates the logical form of prescription. It shows that all forms of action-guiding prescription, as distinguished from agency-commandeering conscription, are underwritten by the same kinds of preference-incumbent principles as draw the cut between and wrongful satisfactions. These impartial principles sound in what the Article calls equality, and are rendered explicit when imperatives are justified by reference to reasons. The Article then analyzes the idiom of social functions (SWFs) in which Paretian legal theorists frame their putative prescriptions. The Article shows that SWFs must be formally supplemented in a manner that registers the preference-incumbency of normative distributional principles, if they are to be suitable for the prescriptive purposes that legal theorists lay out for them. The Article next draws the foregoing analyses together in two simple discursive proofs, counterparts to formal results the author presents elsewhere. The first shows the impossibility of welfarist prescription. The second shows Paretianism's cognate impossibility. These results generalize well known theorems of Arrow and Sen. The Article then presents the welfare alternative. The true Grundnorm for legal theory is an equal opportunity norm that is the material counterpart to that agent equality found earlier in the Article to underlie preference-incumbent norms of distributive propriety. Because those norms constitute the logical form of prescription itself, fair is the appropriate form for our legal prescribing to take.