Talents, Preferences and Inequality of Well-Being

Udo Ebert and Patrick Moyes ()

No V-327-10, Working Papers from University of Oldenburg, Department of Economics

Abstract: The distribution of gross income net of taxes and transfers - or equivalenty consumption - is generally considered a reasonable approximation of the distribution of well-being in the society. One typically observes differing trends in the distribution of gross incomes across countries or within the same country over time. Where do these inequalities originate from? Considering a simple model with no taxation and where individuals belonging to the same society have identical preferences but different productivities, we investigate the impact on the distribution of gross income of changes in the way productivities are distributed. We also look for those changes in the common preference ordering that result in more equally distributed incomes when the allocation of productivities is fixed. Finally, we want to know how preferences have to be adjusted for less dispersed talents to always imply more evenly distributed incomes.

Keywords: Well-Being; Inequality; Talents; Preferences; Lorenz Dominance (search for similar items in EconPapers)
JEL-codes: D31 D61 (search for similar items in EconPapers)
Pages: 38 pages
Date: 2010-06, Revised 2010-06
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Citations: View citations in EconPapers (2)

Published in Oldenburg Working Papers V-327-10

Downloads: (external link)
http://www.vwl.uni-oldenburg.de/download/V-327-10.pdf First version, 2010 (application/pdf)

Related works:
Working Paper: Talents, preferences and inequality of well-being (2010)
Working Paper: Talents, preferences and inequality of well-being (2010)
Working Paper: Talents, preferences and inequality of well-being (2010)
Working Paper: Talents, preferences and inequality of well-being (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:old:dpaper:327

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