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An economic analysis of social exclusion and inequality

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  • Teraji, Shinji

Abstract

This article proposes a theoretical framework for understanding the nature of institutions, contributing to the emergence of the divergence in earnings. In the article, social exclusion is considered as a direct consequence of unequalized opportunities. The population consists of both qualified and unqualified workers. The article shows that there is a threshold level of average performance by unqualified workers below which only qualified workers can earn the higher wage rate. Social exclusion shapes the structure of incentives, and thereby can in itself be the cause of differences in economic performance.

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File URL: http://www.sciencedirect.com/science/article/B6W5H-51TGG41-6/2/bb0a8700ba4f3dfb1080b49718253914
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Bibliographic Info

Article provided by Elsevier in its journal Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics).

Volume (Year): 40 (2011)
Issue (Month): 3 (May)
Pages: 217-223

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Handle: RePEc:eee:soceco:v:40:y:2011:i:3:p:217-223

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Web page: http://www.elsevier.com/locate/inca/620175

Related research

Keywords: Institutions Social exclusion Inequality Economic performance;

References

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  17. Claudia Goldin & Robert A. Margo, 1991. "The Great Compression: The Wage Structure in the United States at Mid- Century," NBER Working Papers 3817, National Bureau of Economic Research, Inc.
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  20. Teraji, Shinji, 2009. "The economics of possible selves," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 38(1), pages 45-51, January.
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