This report estimates the "social rate of time preference" (SRTP) for New Zealand public policy appraisal using a Ramsey equation. It uses the Weitzman (1998) method to derive a declining discount rate schedule of 2% (real) for years 1-30, 1.5% for years 31-100, and 1% for years 101 on. The...

In welfare economics, the theory of second best is inextricably linked to an article by Richard George Lipsey and Kelvin John Lancaster, published in 1956 in the Review of Economic Studies. The publication of this article was encouraged by Harry Gordon Johnson, who was a member of the journal's...

This paper proposes a conceptual model of decision-making tying specific preferences to broader individual goals. In particular, the model considers two hierarchically ordered types of goals: Terminal goals, which represent fundamental objectives (e.g., health, social connection, etc.), and...

We propose a method for cost-benefit analysis of public policies that identifies potential Pareto improvements when losers from a reform are compensated through income tax changes. Reforms are desirable when they decrease aggregate excess burden in commodity and labor markets. This condition is...

This study explores the way in which social information about giving impacts the stability of distributional preferences. We designed a two-stage treatment which varied the information participants received about the maximum amounts given to recipients. Information on maximum giving can...

Why is in-kind aid a prominent feature of welfare systems? We present a lab-in-the-field experiment involving members of the general U.S. population and SNAP recipients. After documenting a widespread desire to limit recipients’ choices, we quantify the relative importance of (i) welfarist...

This paper contrasts two kinds of political economy, represented by welfare economics and social choice theory on the one hand and James M. Buchanan's constitutional political economy on the other hand. It posits that the difference between the two kinds has its roots in the different normative...

This paper examines paternalistic preferences in large-scale experiments in the U.S. Participants decide whether to intervene to prevent a stakeholder, mistaken about their options, to make a choice that is misaligned with their preferences. We find that the willingness to intervene strongly...

We reappraise the Arrow problem by studying the aggregation of choice functions. We do so in the general framework of judgment aggregation, in which choice functions are naturally representable by specifying, for each menu A and each alternative x in A, whether x is choosable from A, or not. Our...

How much does society value redistribution? The common method to derive inverse-optimum welfare weights is by inverting an optimal-tax model. Our alternative imposes fewer restrictions on labor supply and enables comparisons across household types. We use a structural labor supply model to...

This paper analyzes the welfare implications of children’s enfranchisement within a political economy framework that emphasizes the trade-offs in public policy when the electorate includes different age groups. Public spending is financed by tax revenues, meaning that higher spending on...

How much does society value redistribution? The common method to derive inverse-optimum welfare weights is by inverting an optimal-tax model. Our alternative imposes fewer restrictions on labor supply and enables comparisons across household types. We use a structural labor supply model to...

This study theoretically explores the impact of market segmentation uncertainty on producers' production decisions and their subsequent effects on producers' profits, consumer surplus, and social welfare. This uncertainty creates a mismatch between the producer's supply and consumer demand,...

We develop a social choice experiment to estimate public preferences on population ethics. Our experiment poses three within-subject treatments in which participants allocate scarce resources to determine the health-related quality-of-life, and existence, of two population groups. Within a...