Achieving fairness by trying to achieve equality in outcomes rather than equality of provision. It is based on the idea of moral equality. Economists consider two types of equity:
Horizontal equity: Achieving fairness by ensuring that those that have the same contribute the same and those that need the same receive the same. Horizontal equity is the equal treatment of equals.
Vertical equity: Achieving fairness by ensuring that those that have more contribute more and those that need more receive more. Vertical equity implies redistribution of resources to achieve equity of outcomes.