Efficiency, fairness & irrationality: incompatible or complementary?

Most scholars tend to promote a market philosophy based on efficiency, fairness or participant behaviour on the assumption that these three positions are mutually exclusive. However, this article argues that these three approaches are not incompatible. None of us are entirely rational at all times and market conduct reflects this. Moreover, investment decisions often encompass fairness as well as efficiency principles. Economic efficiency in the form of lower capital costs may therefore be best achieved in contemporary markets when concepts of market fairness such as equality of access and investor confidence are emphasized.