Matthew Adler (Duke): “Extended preferences and measuring well-being”

Abstract: In this talk, I present an account of interpersonal comparisons – the so-called “extended preferences” account – for the case where individuals have heterogeneous preferences. The term “extended preferences” was introduced by John Harsanyi. My account builds from Harsanyi’s pioneering work concerning interpersonal comparisons, and in recognition of his contribution I use that term. The key insights are, first, that we should model individual lives as “histories,” i.e., hybrid bundles of attributes and preferences; and, second, that a measure of well-being levels and differences (if it incorporates a respect for individuals’ preferences) must be such that the number assigned to a given history is an increasing function of the utility assigned to the history’s attributes by a vNM utility function representing the history’s preferences.

The talk will explain the extended-preference account; discuss important open questions; and contrast it with a competing approach to interpersonal comparisons with heterogeneous preferences, the “equivalent income” framework.