Personal Goods, Efficiency And The Law

Personal goods, such as leisure and life expectancy, have no unique market price which is the same for everybody. When personal goods are arguments in the utility fucntion and when everybody's utility function is the same, the valuation of personal goods is higher for rich people than for poor people. Thus, rigidly applied in cost-benefit analysis or in the design of the law, the efficiency criterion places a higher value upon the life of a rich person than upon the life of a poor person.