Beyond Outcomes: Measuring Procedural Utility
Bruno S. Frey
CREMA; Behavioural Science; Economics
University of Basel - Department of Business and Economics; Institute for the Study of Labor (IZA)
June 15, 2004
University of Zurich Economics Working Paper No. 76
People not only obtain utility from actual outcomes but also from the conditions which lead to these outcomes. The paper proposes an economic concept of this notion of procedural utility. Preferences beyond outcome can be manifold. We distinguish procedural utility people get from institutions as such, i.e. from how allocative and redistributive decisions are taken, procedural utility from activities towards which people have an intrinsic attitude and procedural utility from the way being treated in interaction with other people. In an empirical application, it is studied whether people gain procedural utility from participating in the political decision-making process itself, irrespective of the outcome. Utility is measured by individuals' reported subjective well-being. We find that participation rights provide procedural utility in terms of a feeling of self-determination and influence. In contrast, actual participation and use of participation rights does not.
Number of Pages in PDF File: 30
Keywords: Procedural utility, subjective well-being, political participation, participation
JEL Classification: D60, D63, D72, H73, I31working papers series
Date posted: July 28, 2004
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