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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.

Suggested Citation

  • Teraji, Shinji, 2011. "An economic analysis of social exclusion and inequality," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 40(3), pages 217-223, May.
  • Handle: RePEc:eee:soceco:v:40:y:2011:i:3:p:217-223
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    References listed on IDEAS

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    Cited by:

    1. Wasseem Mina, 2014. "But Most of All We Love Each Other: Does Social Cohesion Pay off? Evidence from FDI Flows to Middle Income Countries," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper1424, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.

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