Distributional Neutral Welfare Ranking-Extending Pareto Principle

Sugata Marjit and Sandip Sarkar ()

MPRA Paper from University Library of Munich, Germany

Abstract: We extend standard Pareto criterion for welfare ranking in terms of inequality. We suggest strongly Pareto superior or SPS allocations which are inequality neutral but guarantee higher welfare for everyone. The purpose is to entertain the idea that rising inequality is a major welfare concern and hence one must go beyond standard Pareto superior (PS) allocations that necessarily lead to greater inequality. In the main result of this paper we show that whenever there is aggregate gain in net utility then there exists counterfactual allocation which is eventually a SPS allocation.

Keywords: Strong Pareto Superiority; Inequality; Trade (search for similar items in EconPapers)
JEL-codes: D61 D63 F10 (search for similar items in EconPapers)
Date: 2016-09-27
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https://mpra.ub.uni-muenchen.de/74098/1/MPRA_paper_74098.pdf original version (application/pdf)

Related works:
Working Paper: Distribution-neutral Welfare Ranking-Extending Pareto Principle (2017)
Working Paper: Distributional Neutral Welfare Ranking-Extending Pareto Principle (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:74098

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