Economic Justice and the Contract Method Albert

Morals by Agreement contained a distinctive theory of economic justice alongside its theory of moral obligation. That theory involved the principle that individuals were entitled to the full fruits of their labour in situations of isolated production, but not in situations where social cooperation was needed for production. In the latter case, factor rent was to be included in the cooperative surplus, which itself was to be distributed according to the principle of minimax relative concession. Three issues are identified in connection with this approach: the role of Coasean bargains; the denial of an individual entitlement to factor rent; and the specification of the bargaining solution. Analysis of these issues reveals that the social contract has to be a multilateral one involving a jointly rational commitment to a system of governance. In the light of this conclusion, Gauthier's work can be reinterpreted as a contribution to the political theory of a property-owning democracy.