The (Stabilized) Nash Bargaining Solution as a Principle of Distributive Justice

Utilitas 22 (4):447-473 (2010)
It is argued that the Nash bargaining solution cannot serve as a principle of distributive justice because (i) it cannot secure stable cooperation in repeated interactions and (ii) it cannot capture our moral intuitions concerning distributive questions. In this article, I propose a solution to the first problem by amending the Nash bargaining solution so that it can maintain stable cooperation among rational bargainers. I call the resulting principle the stabilized Nash bargaining solution. The principle defends justice in the form 'each according to her basic needs and above this level according to her relative bargaining power'. In response to the second problem, I argue that the stabilized Nash bargaining solution can serve as a principle of distributive justice in certain situations where moral reasoning is reduced to instrumental reasoning. In particular, I argue that rational individuals would choose the stabilized Nash bargaining solution in Rawls' original position.
Keywords Contractualism  Rationality  Reasonableness  Stabilized Nash bargaining solution
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DOI 10.1017/S0953820810000348
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John Rawls (1993). Political Liberalism. Columbia University Press.

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Jonathan Shalev (2002). Loss Aversion and Bargaining. Theory and Decision 52 (3):201-232.
Paul Weirich (1991). Contractiarianism and Bargaining Theory. Journal of Philosophical Research 16:369-385.

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