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Integration, social distress, and policy formation

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  • Stark, Oded

Abstract

I study the integration of regions in the form of a merger of populations, which I interpret as a revision of people's social space and their comparison set; I illustrate the way in which a merger can aggravate social distress; and I consider policy responses. Specifically, I view the merger of populations as a merger of income vectors; I measure social distress by aggregate relative deprivation; I demonstrate that a merger increases aggregate relative deprivation; and I show that a social planner is able to reverse this increase by means of least-cost, post-merger increases in individual incomes, but is unable to counter it by relying exclusively on a self-contained income redistribution that retains individual levels of wellbeing at their pre-merger levels. --

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Bibliographic Info

Paper provided by University of Tuebingen, Faculty of Economics and Social Sciences in its series University of Tuebingen Working Papers in Economics and Finance with number 25.

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Date of creation: 2012
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Handle: RePEc:zbw:tuewef:25

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Keywords: integration of regions; merger of populations; revision of social space; aggregate relative deprivation; social distress; policy responses;

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  1. C. Simon Fan & Oded Stark, 2011. "A Theory Of Migration As A Response To Occupational Stigma," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 52(2), pages 549-571, 05.
  2. Stark, Oded, 2010. "Looking at the Integration of Nations through the Lens of the Merger of Populations: Preliminary Superadditivity and Impossibility Results," MPRA Paper 28701, University Library of Munich, Germany.
  3. Stark, Oded & Hyll, Walter & Wang, Yong, 2011. "Endogenous Selection of Comparison Groups, Human Capital Formation, and Tax Policy," Discussion Papers, University of Bonn, Center for Development Research (ZEF) 99415, University of Bonn, Center for Development Research (ZEF).
  4. Hey, John D & Lambert, Peter J, 1980. "Relative Deprivation and the Gini Coefficient: Comment," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 95(3), pages 567-73, November.
  5. Hyll, Walter & Stark, Oded, 2011. "On the economic architecture of the workplace: repercussions of social comparisons amongst heterogeneous workers," University of Tuebingen Working Papers in Economics and Finance 6, University of Tuebingen, Faculty of Economics and Social Sciences.
  6. Stark, Oded & Fan, C. Simon, 2010. "Migration for degrading work as an escape from humiliation," MPRA Paper 28905, University Library of Munich, Germany.
  7. Yitzhaki, Shlomo, 1979. "Relative Deprivation and the Gini Coefficient," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 93(2), pages 321-24, May.
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