[This is part of the series: The Complete Guide To Economics 101.]

What is utilitarianism?

Utilitarianism is a political or moral theory that values increasing overall utility above other values.

This means Policy 2 is always preferred to Policy 1.

Group 1 – Utility of 50, increases to 75.

Group 2 – Utility of 200, increases to 225.

Policy 1 Total Utility = 300

Policy 2
Group 1 – Utility of 50, increases to 51.
Group 2 – Utility of 200, increases to 250.
Policy 2 Total Utility = 301

[This is part of the series: The Complete Guide To Economics 101.]

What are in-kind transfers?

In-Kind Transfers are transfers to others – usually the poor – that are non-monetary.

Typically, these transfers are some form of goods and/or services.

Common examples are food stamps, and medical care.

Rather that giving cash for the poor to buy food or medical care, the benefits are given directly.