PRICE INDEX DISPERSION AND UTILITARIAN SOCIAL EVALUATION

Christophe Muller

Working Papers. Serie AD from Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie)

Abstract: The living standard indicator in utilitarian social evaluation functions (USEF) is the ratio of a nominal living standard and a price index. We show that under weak association of price indices and nominal living standards and usual concavity conditions on utility functions, utilitarian social welfare increases with price index dispersion when the aggregate price level is superior to the arithmetic mean of price indices, and diminishes when it is inferior to the harmonic mean.

Keywords: Personal income distribution; economic welfare; price dispersion (search for similar items in EconPapers)
JEL-codes: D31 D6 (search for similar items in EconPapers)
Pages: 10 pages
Date: 2005-03
New Economics Papers: this item is included in nep-upt
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Published by Ivie

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http://www.ivie.es/downloads/docs/wpasad/wpasad-2005-09.pdf Fisrt version / Primera version, 2005 (application/pdf)

Related works:
Journal Article: Price index dispersion and utilitarian social evaluation (2005)
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Persistent link: https://EconPapers.repec.org/RePEc:ivi:wpasad:2005-09

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