Social Welfare, Inequality and Deprivation (original) (raw)

ORIGINAL PAPER Deprivation, welfare and inequality

We provide a characterization of the generalised satisfaction-in our terminology non-deprivation-quasi-ordering introduced by S.R. Chakravarty (Keio Econ Stud 34:17-32, (1997)) for making welfare comparisons. The non-deprivation quasi-ordering obeys a weaker version of the principle of transfers: welfare improves only for specific combinations of progressive transfers, which impose that the same amount be taken from richer individuals and allocated to one arbitrary poorer individual. We identify the extended Gini social welfare functions that are consistent with this principle and we show that the unanimity of value judgements among this class is identical to the ranking of distributions implied by the non-deprivation quasiordering. We extend the approach to the measurement of inequality by considering the corresponding relative and absolute ethical inequality indices.

Deprivation, welfare and inequality

Social Choice and Welfare, 2009

We introduce a new criterion for making welfare comparisons based on the absence of deprivation. This method constitutes a natural alternative to the standard approach in normative economics, which consists in comparing the generalised Lorenz curves of the distributions. The generalised Lorenz criterion is consistent with the principle of transfers, which requires that welfare increases as the result of an arbitrary progressive transfer. The criterion we propose obeys a weaker version of the principle of transfers: welfare improves only for some specific combinations of progressive transfers, where the positions of the donors and beneficiaries of the transfers play a crucial role. We extend the approach to the measurement of inequality by considering the corresponding relative and absolute ethical inequality indices.

Restricted and Unrestricted Dominance for Welfare, Inequality and Poverty Orderings

SSRN Electronic Journal, 2003

This paper extends the previous literature on the ethical links between the measurement of poverty, social welfare and inequality. We show inter alia, how, when the range of possible poverty lines is unbounded above, a robust ranking of absolute poverty may be interpreted as a robust ranking of social welfare, and a robust ranking of relative poverty may be interpreted as a robust ranking of inequality, and this, for any order of stochastic dominance.

Income inequality and relative deprivation

Keio Economic …, 1995

This paper examines the implications of the ranking relation generated by two non-intersecting relative deprivation curves as developed in Kakwani (1984). It is shown that the dominance in terms of relative deprivation implies the Lorenz domination, hence welfare improvement ...

Three welfare orderings that are fully comparable revisited

Multiple Criteria Decision Making, 2018

We are concerned with welfare orderings on the set of evaluation vectors. In our framework the number of agents, criteria or states of nature is fixed and an evaluation vector assigns a real valued evaluation to each criteria, agent or state of nature. Hence the space of evaluation vectors is a finite dimensional Euclidean space. In such a context we provide axiomatic characterizations of the utilitarian, maximin and leximin welfare orderings. The axiomatic characterization of the utilitarian welfare ordering is based on a quasi-linearity property. The axiomatic characterizations of the maximin and leximin welfare orderings are obtained by suitably modifying the axioms used by Barbera and Jackson (1988).

Partial Horizontal Inequity Orderings: A Non-parametric Approach*

Oxford Bulletin of Economics and Statistics, 2005

We provide a partial ordering view of horizontal inequity (HI), based on the Lorenz criterion, associated with different post-tax income distributions and a (bistochastic) non-parametric estimated benchmark distribution. As a consequence, several measures consistent with the Lorenz criterion can be rationalized. In addition, we establish the so-called HI transfer principle, which imposes a normative minimum requirement that any HI measure must satisfy. Our proposed HI ordering is consistent with this principle. Moreover, we adopt a cardinal view to decompose the total effect of a tax system into a welfare gain caused by HI-free income redistribution and a welfare loss caused by HI, without any additive decomposable restriction on the indices. Hence, more robust tests can be applied. Other decompositions in the literature are seen as particular cases.

Social welfare with incomplete ordinal interpersonal comparisons

Let X be a set of "personal states"; any person, in any circumstance, is at some point in X . A social state assigns an element of X to every person in society. Suppose it is sometimes possible to make ordinal interpersonal comparisons of well-being. We represent this with a (possibly incomplete) preorder on X . From this, we can derive a (possibly incomplete) preorder on the set of social states, which ranks them in terms of their aggregate welfare. We define the appropriate analogs of the maximin and leximin social welfare orders in this framework, and axiomatically characterize them. for hybrid interpersonal comparisons of this kind. 5 A large philosophical literature on "vagueness" has arisen in response to the Sorites Paradox; see Keefe (2000) for a review.

Inequality and welfare in market economies

Journal of Public Economics, 1990

have shown how Lorenz rankings of distributions of a fixed amount of income (or a single commodity) may correspond to social welfare rankings: lower inequality indicates higher social welfare. Atkinson and Bourguignon (1982) and Kolm (1977) offer two ways of extending this result to multi-commodity environments. We investigate an alternative approach based on the existence of markets and market prices at which agents maximize utility. Our main result offers a welfare-based method of making real national income comparisons which takes into account the distribution of individual welfare.