III. Justice is the first value of social institutions

Justice is a measure of healthy social development and the basic value of social development as well. American political philosopher and ethicist John Bordley Rawls once said, “Justice is the first virtue of social institutions, as truth is of systems of thought. A theory, however elegant and economical, must be rejected or revised if it is untrue; likewise laws and institutions, no matter how efficient and well-arranged, must be reformed or abolished if they are unjust. Each person possesses an inviolability founded on justice that even the welfare of society as a whole cannot override. For this reason justice denies that the loss of freedom for some is made right by a greater good shared by others. ”

i. Social justice must be taken into consideration in institutional design

In a society, the fundamental purpose of institutional design is to establish a certain social order to ensure stable and benign social operations. A society is always made up of countless individuals having conflicts of interests and competitions. On the one hand, competitions make people feel the stress and their vitality, and promote the improvement of efficiency; on the other hand, vicious competitions would lead the whole society into a disorderly state, and cause a loss and decline of the overall efficiency, or even to the disintegration and collapse of the society. Therefore, in order to maintain orderly competitions in the society, it is a must to establish certain systems. Only just systems can better achieve the objective.

John Bordley Rawls said, “There is an identity of interests since social cooperation makes possible a better life for all than any would have if each were to live solely by his own efforts. There is a conflict of interests since persons are not indifferent as to how the greater benefits produced by their collaboration are distributed, for in order to pursue their ends they each prefer a larger to a lesser share. A set of principles is required for choosing among the various social arrangements which determine this division of advantages and for underwriting an agreement on the proper distributive shares. These principles are the principles of social justice:they provide a way of assigning rights and duties in the basic institutions of society and they define the appropriate distribution of the benefits and burdens of social cooperation. ”Legislation and institutional design failing to take into account social justice can produce only bad laws, and lead to periodic chaos.

If people were treated unjustly in social cooperation and interpersonal communications, they would usually think it unjust, and feel wronged and angry, which may even lead to retaliation. Such mentality and behavior would then dilute trust among people, worsen mutual relations, make social cooperation hard to continue, and affect the sustained and stable economic development and lasting law and order in the society. Therefore, only with just systems can a society provide equal rights and opportunities for human development, and can the survival and development of each social member be ensured. With just social institutions, people can get what they deserve and meet their reasonable expectations by honest labor, which then could mobilize their initiative. For the society as a whole, each and every social member is in his proper place, has his own task to do, and does his utmost to jointly advance sustained and healthy social development.

ii. Justice is the fundamental source of institutional authority, and the basic guarantee for the vigor of social institutions as well

Institution is about constraints over the people, so an institution cannot be thoroughly implemented only when it has certain authority. Such authority may come from moral appeal like the examples of dutiful institution developers and executors, but it comes more from some regulatory authority—mandatory punishment of behaviors against the institution, or draconian law. Fundamentally, the authority of institutions comes from their public nature and the general acceptance of them by the people. In history, the more just an institution was, the less regulatory authority it needed; the less just an institution was, the more it needed to be maintained by force. Institutions sustained mainly by force were usually short-lived, and unable to stand the test of time.

The studies of modern institutional economics show that the more just an institution is, the more likely it is recognized and followed by the majority of the people, the more conducive it is to making people have reasonable expectations, reducing people's shortsighted behaviors, mitigating interpersonal conflicts, and cutting down transaction costs in the society. Meanwhile, just institutions help reduce the number of administrative organs, cut down the costs needed to maintain the systems, and improve the overall efficiency of social activities in a society. From this perspective, just social institutions are not only a sharp weapon to protect social justice and the basic way of maintaining social stability and orderly social operations, but also the basic way of improving and enhancing the efficiency in social activities.