Evaluating Real World Income Distributions behind the Veil of Ignorance - How Risk Averse do you have to be to Prefer Europe over the US?
The paper uses a veil of ignorance approach and income distribution data of developed countries to arrive at inequality corrected income rankings. While a risk neutral individual (based on year 2000 data) would have preferred to be born into the US rather than any European country in our sample except Luxembourg, a coefficient of relative risk aversion of 2 suffices to make several European countries look preferable. The paper also sheds light on the risk corrected average income on a gender basis and scans for times of diminished expectations, i.e. periods where the expected utility of being born into a country has reduced over time.
|Date of creation:||2011|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: +49 (89) 9224-0
Fax: +49 (89) 985369
Web page: http://www.cesifo.de
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Sinn, Hans-Werner, 1995.
"A Theory of the Welfare State,"
CEPR Discussion Papers
1278, C.E.P.R. Discussion Papers.
- Lancaster, Geoffrey & Ray, Ranjan & Valenzuela, Maria Rebecca, 1999. "A Cross-Country Study of Equivalence Scales and Expenditure Inequality on Unit Record Household Budget Data," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 45(4), pages 455-82, December.
- Haddad, Lawrence & Kanbur, Ravi, 1989.
"How serious is the neglect of intrahousehold inequality ?,"
Policy Research Working Paper Series
296, The World Bank.
- Haddad, Lawrence & Kanbur, Ravi, 1990. "How Serious Is the Neglect of Intra-Household Inequality?," Economic Journal, Royal Economic Society, vol. 100(402), pages 866-81, September.
- Haddad, L. & Kanbur, R., 1989. "How Serious Is The Neglectof Intra-Household Inequality?," Papers 450, Stockholm - International Economic Studies.
- Phipps, Shelley & Garner, Thesia I, 1994.
"Are Equivalence Scales the Same for the United States and Canada?,"
Review of Income and Wealth,
International Association for Research in Income and Wealth, vol. 40(1), pages 1-17, March.
- Garner, T.I. & Phipps, S., 1993. "Are Equivalence Scales the Same for the United States and Canada?," Department of Economics at Dalhousie University working papers archive 93-02, Dalhousie, Department of Economics.
- Milton Friedman, 1953. "Choice, Chance, and the Personal Distribution of Income," Journal of Political Economy, University of Chicago Press, vol. 61, pages 277.
When requesting a correction, please mention this item's handle: RePEc:ces:ceswps:_3632. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Julio Saavedra)
If references are entirely missing, you can add them using this form.