The Principle of Strong Diminishing Transfer
AbstractWe reconsider the principles of diminishing transfer (introduced by Kolm ) and dual diminishing transfer (introduced by Mehran ). It appears that if a Rank Dependent Expected Utility (RDEU) maximizer respects the principle of diminishing (resp. dual diminishing) transfer, then he behaves in accordance with the Expected Utility model (resp. Yaari's dual model).This leads us to define the principle of strong diminishing transfer, which is a combination of the principles of diminishing and dual diminishing transfer. We give necessary conditions for a RDEU maximizer to respect this principle.These results are applied to the problem of inequality measurement.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Economic Theory.
Volume (Year): 103 (2002)
Issue (Month): 2 (April)
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Web page: http://www.elsevier.com/locate/inca/622869
Other versions of this item:
- Chateauneuf, A. & Gajdos, T. & Wilthien, P.-H., 1999. "The Principle of Strong Kiminishing Transfer," Papiers d'Economie MathÃÂ©matique et Applications 1999-96, UniversitÃ© PanthÃ©on-Sorbonne (Paris 1).
- Alain Chateauneuf & Thibault Gajdos & Pierre-Henry Wilthien, 2002. "The Principle of Strong Diminishing Transfer," UniversitÃ© Paris1 PanthÃ©on-Sorbonne (Post-Print and Working Papers) halshs-00085936, HAL.
- D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
- D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
- D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
- D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
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