In John Rawls' A Theory of Justice, people choose the rules for distributing income from behind a veil of ignorance.People understand that ability determines income, but they do not know their abilities or the abilities of others.Rawls argues that people are risk averse and will choose the distribution rule that maximizes their income in the worst-case scenario (they have relatively little ability).An economist would call this strategy
A)minimax.
B)maximin.
C)irrational.
D)tacit collusion.

Question

Quizplus · Accepted Answer

The economist would call this strategy maximin, which involves maximizing the minimum potential outcome. In this case, individuals are choosing the distribution rule that maximizes their income in the worst-case scenario, which is the minimum potential outcome if they have relatively little ability. Maximin is a common strategy in decision-making under uncertainty or risk aversion.

In John Rawls' a Theory of Justice, People Choose the Rules