A Welfare Decomposition in Quasi-Linear Economies

Taiji Furusawa and Hideo Konishi

No 569, Boston College Working Papers in Economics from Boston College Department of Economics

Abstract: We propose a decomposition of social welfare when consumers' preferences are described by quasi-linear utility functions. In our decomposition, social welfare is expressed as the sum of consumers' gross utilities and trade surplus of non-numeraire goods, whose consumption enters utility functions non-linearly. This decomposition is useful especially when we assess the impact of trade liberalization on individual countries. We propose a decomposition of social welfare when consumers' preferences are described by quasi-linear utility functions. In our decomposition, social welfare is expressed as the sum of consumers' gross utilities and trade surplus of non-numeraire goods, whose consumption enters utility functions non-linearly. This decomposition is useful especially when we assess the impact of trade liberalization on individual countries.

Keywords: social welfare; GATT think; quasi-linear utility (search for similar items in EconPapers)
JEL-codes: F10 (search for similar items in EconPapers)
Date: 2003-08-27
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Citations: View citations in EconPapers (1)

Published, Economics Letters 85, 29-34, 2004.

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Journal Article: A welfare decomposition in quasi-linear economies (2004)
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