Collective decisions under uncertainty: efficiency, ex-ante fairness, and normalization

Abstract

This paper studies preference aggregation under uncertainty in the multi-profile framework and characterizes a new class of aggregation rules that can address classical concerns about Harsanyi's (1995) utilitarian rules. Our aggregation rules, which we call \textit{relative fair aggregation rules}, are grounded in three key ideas: utilitarianism, egalitarianism, and the 0--1 normalization of individual utilities. These rules are parameterized by a set of weight vectors over individuals and evaluate each ambiguous alternative by taking the minimum weighted sum of 0--1 normalized utility levels over the weight set. For the characterization, we propose two novel axioms, \textit{weak preference for mixing} and \textit{restricted certainty independence}, with normative justifications. Additional results clarify how these axioms capture the utilitarian and egalitarian attitudes of the rules.

arXiv commentAccepted at Theoretical Economics