Inequality averse collective choice (Q1300359)

Let \(\Sigma_{n}\) be the class of all compact comprehensive and convex sets in \(\mathbb{R}^{n}_{+}\). The main result in this paper is the following theorem: If \(F\) is a solution concept defined on \(\Sigma_{n}\) which satisfies LPO (Lorentz Pareto Optimality), SARP (Strong Axiom of Revealed Preference) and PC (Pareto Continuity), then it must be representable by a strictly monotonic, strictly Schur-concave and upper semicontinuous Social Welfare Function. The Lorentz-Pareto optimal frontier of a collective choice problem identifies a subset of all Pareto optimal outcomes which are not \textit{inegalitarian} according to the Lorentz criterion. Several applications to the theory of Nash bargaining are also outlined.