On the Inefficiency of Inequality

A number of studies have examined the implications of preference interdependence. This paper models utility as depending on other people?s consumption levels and shows that welfare declines with inequality, equilibrium inequality is inefficient, and the optimal intervention leads to a more equal distribution.

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Year of publication:	2004
Authors:	Schiff, Maurice
Publisher:	Bonn : Institute for the Study of Labor (IZA)
Subject:	Verteilungstheorie \| Konsumentenverhalten \| Konsuminterdependenz \| Einkommensverteilung \| Wohlfahrtseffekt \| Theorie \| inequality \| efficiency

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Series:	IZA Discussion Papers ; 1283
Type of publication:	Book / Working Paper
Type of publication (narrower categories):	Working Paper
Language:	English
Other identifiers:	460239260 [GVK] hdl:10419/20549 [Handle]
Classification:	H21 - Efficiency; Optimal Taxation ; H23 - Externalities; Redistributive Effects ; Environmental Taxes and Subsidies
Source:	EconStor

Persistent link: https://www.econbiz.de/10010262032