Maya Eden joined the Department of Economics at the University of Zurich as Professor of Economics in June 2024 and is an Affiliated Professor at the UBS Center. Her research spans a broad spectrum of issues in welfare economics, macroeconomics and the normative analysis of economic policy. In this interview, she explains why ethical considerations need to be taken in account to design policy and talks about her motivation for conducting research in this area.

This interview by Solenn Le Goff was originally published by the UZH Department of Economics on 3.10.2024. Edited for layout purposes by the UBS Center.

What are the topics you are currently working on?

The goal of my research is to provide guidelines for developing effective public policies. Very often, we have a good understanding of the economic trade-offs associated with different policy options. However, to design policy, we also need to take into account various ethical considerations. In my research, I aim to clarify the implications of different ethical principles.

Consider, for instance, the challenge of designing a redistributive tax system. We know that there is a trade-off between the amount of redistribution and the extent to which people are incentivized to work. I am currently working on understanding what is the ethically desirable way to design tax policy considering this trade-off.

What is the main finding of this work?

I develop a framework for evaluating this trade-off based on two ethical principles. The first is the unanimity principle, which asserts that enhancing the well-being of all individuals is inherently beneficial. It is difficult to dispute this principle. The second principle is that, for the purposes of policy evaluation, we must treat everyone's income uniformly. Let’s take for example a situation in which Ann has 100 CHF and Bob has 50 CHF is to be considered just as good as a situation in which Ann has 50 CHF and Bob has 100 CHF. In many situations, this seems like a very natural starting point.

Now it turns out that the combination of these two intuitive principles is surprisingly powerful. What I show is that, based on these principles, we can derive a formula for the optimal amount of redistribution. Moreover, we can estimate the parameters of this formula based on data available in consumer expenditure surveys.

Is there another important specific work of yours that you would like to mention?

The first project that I described above is quite dismissive of people’s attitudes towards redistribution. What I show there is that, under reasonable assumptions, there is only one correct way to evaluate such trade-offs. It is a matter of math, not opinion. This is quite different from the more democratic attitude that is based on people’s ethical preferences. In a separate project with Paolo Piacquadio, Professor of Applied Economics at University of St. Gallen, we are asking whether individuals’ opinions about redistribution should matter for the optimal amount of redistribution. We show that, under minimal assumptions, individual’s weak ethical preferences place strong restrictions on the optimal policy. To me this is really an uncomfortable conclusion. It says that what is right, in a moral sense, is whatever people happen to believe is right. However, this perspective is fundamentally flawed. For example, not too long ago, some people believed that homosexuality was a sin and that slavery was acceptable. To me, this result feels like an important paradox, which made me question the foundations of our approach to normative evaluation.

You have recently joined UZH, what motivated you to come to Zurich?

UZH is absolutely the best place in the world to pursue my research agenda. The Department of Economics is unique, not only in the quality of the faculty and the students, but also in its strong normative focus.

Who is the inspiration behind your work?

In recent years, much of my work has been inspired by conversations with Itai Sher from UMass Amherst and Paolo Piacquadio from University of St Gallen. Marc Fleurbaey from PSE is another important influence. But I think that the biggest source of inspiration for me is the work done at University of Oxford’s Global Priorities Institute, which hosts both philosophers and economists interested in the question of how to do the most good.