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Social Welfare, Inequality and Deprivation

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  • Brice MAGDALOU (CEREGMIA)
  • Patrick MOYES (GREThA UMR CNRS 5113)

Abstract

We provide a characterization of the generalised satisfaction -- in our terminology non-deprivation -- quasi-ordering introduced by S.R. Chakravarty (Keio Economic Studies 34 (1997), 17--32) for making welfare comparisons based on the absence of deprivation. We show that the non-deprivation quasi-ordering obeys a weaker version of the principle of transfers: welfare improves only for specific combinations of progressive transfers which require that the same amount be taken from richer individuals and allocated to one arbitrary poorer individual. We identify the subclass of extended Gini social welfare functions that are consistent with this principle and we show that the unanimity of value judgements among this class is identical to the ranking of distributions implied by the non-deprivation quasi-ordering. We extend the approach to the measurement of inequality by considering the corresponding relative and absolute ethical inequality indices.

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Paper provided by Groupe de Recherche en Economie Théorique et Appliquée in its series Cahiers du GREThA with number 2008-23.

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Date of creation: 2008
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Handle: RePEc:grt:wpegrt:2008-23

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Keywords: Export diversification; FDI; Growth; MENA; GMM system;

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  1. Alain Chateauneuf & Patrick Moyes, 2005. "Lorenz non-consistent welfare and inequality measurement," Journal of Economic Inequality, Springer, vol. 2(2), pages 61-87, January.
  2. Claudio Zoli, 2002. "Inverse stochastic dominance, inequality measurement and Gini indices," Journal of Economics, Springer, vol. 9(1), pages 119-161, December.
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