An Index of Unfairness

Authors

Victor H. Aguiar
Roland Pongou
Roberto Serrano
Jean-Baptiste Tondji, The University of Texas Rio Grande ValleyFollow

Document Type

Book

Publication Date

3-9-2019

Abstract

The Shapley distance is introduced as a measure of the extent to which output sharing among the stakeholders of an organization can be considered unfair. In fact, it measures the distance between an arbitrary pay profile and the Shapley pay profile under a given technology, the latter profile defining the fair distribution. Therefore, this chapter contributes to the literature that studies economic inequality using game theory. In particular, we provide an axiomatic characterization to a notion of unfairness, namely the Shapley distance, and show that it can be used to determine the outcome of an underlying bargaining process. We also present applications highlighting how favoritism in income distribution, egalitarianism, and taxation violate the different ideals of justice that define the Shapley value and how unfairness can be further unbundled to determine its origins. The analysis has implications that can be tested using real-world data sets.

Comments

"This is an Accepted Manuscript of a book chapter published by Routledge in Handbook of the Shapley Value on 2019, available online: https://doi.org/10.1201/9781351241410

Recommended Citation

Aguiar, Victor and Pongou, Roland and Serrano, Roberto and Tondji, Jean-Baptiste, An Index of Unfairness (March 9, 2019). Aguiar, V. H., Pongou, R., Serrano, R., & Tondji, J. B. (2019). An Index of Unfairness. In Handbook of the Shapley Value (pp. 31-48). CRC Press Taylor and Francis. https://doi.org/10.1201/9781351241410

Publication Title

Handbook of the Shapley Value

DOI

10.2139/ssrn.3350034