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Elias Harris
Elias Harris

Distributive Justice Rawls Pdf Download


Within the economics literature, there is an ongoing discussion as to whether the dramatic rise in wage inequality can be explained solely by economic factors: for recent reviews, see Lemieux et al. (2009) for the United States and Bell and Van Reenen (2013) for the UK. From a business ethics perspective, most contributions have consequently focused on whether the explanations proposed by economists might render large income inequalities morally justified or, more precisely, distributively just. Boatright (2009) and, more cautiously, Moriarty (2009) answer this question in the affirmative; Harris (2009) and Néron (2015) disagree. What is missing from the literature is an empirical investigation into what business executives think about distributive justice, and, by implication, whether they consider high income inequalities to be morally acceptable.Footnote 1 This article aims to fill that gap.




Distributive Justice Rawls Pdf Download


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Establishing what senior executives think about distributive justice matters for at least two reasons. First, senior executives play a key role in shaping organisational pay policies (Sud and VanSandt 2011) as well as other policies that are of interest from the point of view of distributive justice. Second, their opinions can significantly affect how other employees think about distributional issues (see Schein 19852010). The views of senior executives thus affect both the pay policies within their companies and how these policies are evaluated by others within the firm.


The remainder of this article is structured as follows. In the second section, we discuss the normative principles of distributive justice upon which our research is based. In the third section, we discuss our methodology. In the fourth section, we present our findings, which we discuss in the fifth section. The sixth section summarises and concludes.


The philosophical literature on distributive justice is vast. In designing our survey, our goal was to introduce business executives to a range of influential philosophical theories about distributive justice that also have intuitive appeal, as evidenced by empirical studies from economics, political science, and sociology. We included six principles in our questionnaire. The first and second principles emphasise individual merit as the proper basis for allocating economic rewards. The third and fourth concentrate on the significance of needs. The fifth and sixth principles stress the importance of voluntary transactions and economic efficiency. We focused on the justice of earnings from employment as opposed to the just distribution of wealth or other goods, as earnings from employment are a variable that senior executives can influence through the design of organisational pay policies. In what follows, we lay out the philosophical thinking behind the principles and the empirical support that they receive. For convenience, the six principles are summarised in Table 1.


The second principle stipulates that a distributively just society is characterised by equality of opportunity. In such a society, equally talented and hardworking individuals have the same opportunities to be appointed to positions that come with economic advantages; no one is discriminated against because of their gender, ethnicity, socioeconomic background, or their membership in some other socially salient group. In the philosophical literature, equality of opportunity is widely recognised as important for distributive justice (see, for example, Mason 2006). Equality of opportunity is typically considered as a luck egalitarian principle of justice. Luck egalitarian theories are founded on the thought that differences in individual levels of welfare are distributively just only if they are traceable to personal choices for which people can be held morally responsible (Cohen 1989; Dworkin 2000).


The principle of efficiency proceeds from the assumption that in a market-based economy the prices paid for different types of labour should reflect the relative scarcity of that type of labour. This helps to allocate human capital efficiently, so that economic output is maximised. Efficiency is consistent with a utilitarian approach to distributive justice (Harsanyi 1975). From a utilitarian perspective, the right allocation of resources maximises general welfare. If resources are allocated efficiently, the monetary value of what is produced with those resources is maximised. Under certain idealised conditions, this plausibly enables the general welfare to be maximised also.


To encourage executives to think impartially about questions of distributive justice, thus mitigating the effect of self-serving biases, we asked participants to engage in the following thought experiment before answering the questionnaire:


Rows (4) and (5) in Table 4 provide corresponding ratings for perceived principles of justice. The gap between the extent to which principles of distributive justice are endorsed as ideals and the extent to which they are perceived to govern the actual distribution of income is evident by comparing the ratings in rows (1) with (4) and (2) with (5). We can see that the principles that are considered to be most morally relevant (i.e. desert, equality of opportunity, and sufficiency) are not considered to be strong governing principles in the societies in which the respondents live or the companies for which they work. In particular, while most respondents agree that a society governed by equality of opportunity or desert would be distributively just, less than half believe that the societies in which they live are governed by either of these principles. Conversely, for the principles that are generally considered to be less relevant (maximin and entitlement) the distribution of responses is much more similar in the normative versus actual cases at society level. Much the same pattern of results appears at company level.


Our second finding is that executives endorse similar principles at societal and company levels of analysis. Business executives do not appear to believe that companies should simply leave matters of distributive justice for governments to deal with via the tax system. Some economists argue for a separation of responsibilities, such that market participants are responsible for ensuring efficient economic outcomes through their self-interested behaviour, and governments are responsible for redistributing wealth to turn efficient outcomes into fair ones (Heath 2014). Our research suggests that the majority of executives reject this approach, believing instead that companies have a more direct role to play in bringing about distributive justice. This has important practical implications. It suggests that, while senior executives may be happy to receive a significant element of highly geared performance-based pay for themselves, they would also, if pushed, express a belief that all employees in their companies should be allowed to make a decent living.


Our third finding is that most business executives live in societies and work for companies that they perceive to be significantly unjust. Most strikingly, the vast majority of executives think that equality of opportunity is an important principle of distributive justice at the society level of analysis, but less than half believe that the society that they live in is characterised by equal opportunities. At the company level, many executives endorse a desert-based principle of distributive justice, but less than half think that such a principle is representative of existing remuneration policies within their organisations. This finding is of significant practical interest as well. It suggests executives should be prepared to accept a greater focus on distributive justice in company-wide pay policies.


Our fourth finding is that, while distributive justice views among executives are relatively homogenous across demographic markers, some significant variations can nevertheless be identified. Most prominently, respondents who are either younger or who live in China are more likely to endorse the idea that we should combine a sufficientarian floor constraint with desert, thus falling into the cluster of welfare liberals.


In the UK, for example, it used to be the case that company pay policies considered the pay of workers, middle managers, and executives as part of a continuum, with grade bands, pay spines, and job-evaluation applying across the whole spectrum (for further details see Willman and Pepper 2020). Executive pay was largely determined by reference to internal labour markets (and hence internal relativities) rather than external labour markets. Today executive and all-employee pay is generally determined quite separately, paid from different expense budgets, in accordance with different sets of principles, and using different financial instruments (with a significant weighting of variable stock-awards in the case of executives compared with fixed cash payments in the case of other employees). Determining pay by reference to internal labour market relativities meant that company top-to-bottom pay ratios were generally smaller, and possible more distributively just, than they are today. Governments have the ability to nudge companies to change their behaviour in this regard. Recent moves in the US, UK, and other developed economies requiring large companies to publish pay ratios are a step in this direction, but an increased public policy focus on distributive justice should be encouraged.


We add to the empirical literature on distributive justice and executive compensation in various ways. By employing a unique set of primary data about the beliefs of business executives from around the world, we shed light on how senior executives think about distributive justice; as far as we know, our study is the first to explore the views of high-level business executives in this way. We also propose a new field-theory framework for conceptualising beliefs about distributive justice. We argue that, unlike other approaches found in the extant literature, this framework can be used to capture the pluralistic views about distributive justice which our respondents expressed. A field-theory framework might be used more widely to represent the complex and context-dependent theories of justice which we have argued underpin such pluralistic views.


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