Business, College of


Date of this Version

June 2005


Published in the Journal of Economic Issues Volume XXXIX, No. 2, June 2005. Copyright © 2005, Journal of Economic Issues. Used by permission.


Equity criteria are one set of efficiency criteria crucial for evaluating and judging production institutions and processes. Efficiency means the ability to produce a desired effect. Before efficiency can be determined, criteria must be established with regard to what is desirable. Equity—that is, fairness and justice - is one of the effects desired from production processes. Thus, (1) by definition, equity and efficiency cannot be separated. (2) Neither can they be separated in real-world production processes. If, for example, the loss of workers’ respiratory health due to work in a hog production facility is considered unfair and unjust treatment of workers, the technological process is inefficient. (3) Nor can the two be separated for modeling and evaluation and be consistent with instrumentalism, which emphasizes that means and ends should not be separated in analysis because means and ends are a continuum. Likewise, to separate process from result and attempt to judge either one as the exclusive equity concern is an instrumental mistake. Consequently, attempts to separate equity from efficiency are not supported by definition, reality, or instrumental methodology.

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