Research Grants

Grant Winners 2017-18

Can Discrimination be Ethical? Ronen Avraham
In this research project, we explore the ethical limits of an unobserved before type of discrimination which we (temporarily) call: beneficial statistical discrimination (BSD). Under this practice, a rational agent pursues her own self-interest by statistically discriminating against a disadvantaged group. The unique feature of BSD is that the targeted group also benefits from the practice. Should such practice be allowed? Should it be encouraged or even required? What role should the victim-group’s consent to such a practice play? While there is voluminous literature, written by lawyers, philosophers, economists and other public policy makers on intentional discrimination, statistical discrimination and affirmative action, to the best of our knowledge there is no literature on BSD. This project will fill this gap by a) developing a rational choice model of beneficial statistical discrimination, and b) analyzing its ethical and social desirability. The research project is expected to make several contributions. It shall contribute to our normative understanding of the ethics of discrimination and consent, to the economic literature on statistical discrimination as well as to the doctrinal analysis of various legal practices, especially in torts and insurance. The project will last a year and will include both economic modeling and philosophical inquiry. The output is a 25,000 words paper in English. To have a better grasp of the problem, consider the following example; suppose black neighborhoods cannot attract doctors because they cannot compensate the doctors enough for their high value medical services. Because doctors on average confer more benefits than harm, the black neighborhoods are very interested in their services. As a result, they attempt to attract doctors by offering them lower risks of malpractice suits. An OBGYN who makes $300,000 a year but has to pay $150,000 liability insurance might feel incentivized to work in a black neighborhood where she makes only $200,000 but her insurance premium is just $20,000 due to a lower standard of care. As before, the blacks themselves might be better off – without a reduction in the standard of care they will get no OBGYN at all. Should the law allow such transactions?

Can Discrimination be Ethical?

In this research project, we explore the ethical limits of an unobserved before type of discrimination which we (temporarily) call: beneficial statistical discrimination (BSD). Under this practice, a rational agent pursues her own self-interest by statistically discriminating against a disadvantaged group. The unique feature of BSD is that the targeted group also benefits from the practice. Should such practice be allowed? Should it be encouraged or even required? What role should the victim-group’s consent to such a practice play?

While there is voluminous literature, written by lawyers, philosophers, economists and other public policy makers on intentional discrimination, statistical discrimination and affirmative action, to the best of our knowledge there is no literature on BSD. This project will fill this gap by a) developing a rational choice model of beneficial statistical discrimination, and b) analyzing its ethical and social desirability.

The research project is expected to make several contributions. It shall contribute to our normative understanding of the ethics of discrimination and consent, to the economic literature on statistical discrimination as well as to the doctrinal analysis of various legal practices, especially in torts and insurance. The project will last a year and will include both economic modeling and philosophical inquiry. The output is a 25,000 words paper in English.

To have a better grasp of the problem, consider the following example; suppose black neighborhoods cannot attract doctors because they cannot compensate the doctors enough for their high value medical services. Because doctors on average confer more benefits than harm, the black neighborhoods are very interested in their services. As a result, they attempt to attract doctors by offering them lower risks of malpractice suits. An OBGYN who makes $300,000 a year but has to pay $150,000 liability insurance might feel incentivized to work in a black neighborhood where she makes only $200,000 but her insurance premium is just $20,000 due to a lower standard of care. As before, the blacks themselves might be better off – without a reduction in the standard of care they will get no OBGYN at all. Should the law allow such transactions?

Public attitudes toward the manipulation of behavior for the overall benefit of society Ayala Arad and Ariel Rubinstein
In this project, we intend to experimentally analyze a policy question of major importance: Are people interested only in the consequences of government policy or do they also care about the methods by which the consequences are achieved? Do people object government interventions that use psychological manipulations to alter their behavior even if they fully agree with the goals of those interventions? Is the opposition to such interventions strong enough that they are prepared to take actions not in their best interests in order to express that opposition? Do individuals prefer interventions that are less manipulative even at the expense of their effectiveness? The project is related to the recent debate in academic circles regarding the type of intervention currently referred to as “nudges”, which have recently become popular in many Western countries.

Public attitudes toward the manipulation of behavior for the overall benefit of society

Ayala Arad and Ariel Rubinstein

In this project, we intend to experimentally analyze a policy question of major importance: Are people interested only in the consequences of government policy or do they also care about the methods by which the consequences are achieved? Do people object government interventions that use psychological manipulations to alter their behavior even if they fully agree with the goals of those interventions? Is the opposition to such interventions strong enough that they are prepared to take actions not in their best interests in order to express that opposition? Do individuals prefer interventions that are less manipulative even at the expense of their effectiveness?

The project is related to the recent debate in academic circles regarding the type of intervention currently referred to as “nudges”, which have recently become popular in many Western countries.