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Who's afraid of aggregating money metrics?

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  • Kristof Bosmans
  • Koen Decancq
  • Erwin Ooghe

Abstract

We provide an axiomatic justification to aggregate money metrics. The key axiom requires the approval of richer-to-poorer transfers that preserve the overall efficiency of the distribution. This transfer principle, together with the basic axioms anonimity, continuity, monotonicity, and a version of welfarism, characterizes a standard social welfare function defined over money metric utilities.

Suggested Citation

  • Kristof Bosmans & Koen Decancq & Erwin Ooghe, 2016. "Who's afraid of aggregating money metrics?," Working Papers of Department of Economics, Leuven 551153, KU Leuven, Faculty of Economics and Business (FEB), Department of Economics, Leuven.
    • Handle: RePEc:ete:ceswps:551153
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Olivier Bargain, 2017. "Welfare analysis and redistributive policies," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 15(4), pages 393-419, December.
    2. Alpaslan Akay & Olivier Bargain & H. Xavier Jara, 2020. "‘Fair’ welfare comparisons with heterogeneous tastes: subjective versus revealed preferences," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 55(1), pages 51-84, June.
    3. Bosmans, Kristof & Decancq, Koen & Ooghe, Erwin, 2015. "What do normative indices of multidimensional inequality really measure?," Journal of Public Economics, Elsevier, vol. 130(C), pages 94-104.
    4. DECANCQ Koen & OLIVERA Javier & SCHOKKAERT Erik, 2018. "Program evaluation and ethnic differences: the Pension 65 program in Peru," LISER Working Paper Series 2018-21, Luxembourg Institute of Socio-Economic Research (LISER).
    5. Decancq, Koen & Nys, Annemie, 2021. "Non-parametric well-being comparisons," European Economic Review, Elsevier, vol. 133(C).
    6. Max Franks & Ottmar Edenhofer, 2020. "Optimal Redistributive Wealth Taxation When Wealth Is More Than Just Capital," CESifo Working Paper Series 8093, CESifo.
    7. Schlee, Edward E. & Ali Khan, M., 2023. "Money-metrics in local welfare analysis: Pareto improvements and equity considerations," Journal of Economic Theory, Elsevier, vol. 213(C).
    8. Matthew D. Adler & Koen Decancq, 2021. "Well-Being Measurement," Working Papers 2105, Herman Deleeck Centre for Social Policy, University of Antwerp.
    9. Erwin Ooghe & Erik Schokkaert & Hannes Serruys, 2023. "Fair Earnings Tax Reforms," CESifo Working Paper Series 10242, CESifo.
    10. Miyagishima, Kaname, 2019. "Fair criteria for social decisions under uncertainty," Journal of Mathematical Economics, Elsevier, vol. 80(C), pages 77-87.

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    More about this item

    JEL classification:

    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being

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