Happiness and Pareto
While the utilitarian notion of ‘happiness’ is unsatisfactory, widespread interest in the subject suggests that economists are recognising the importance of relative income status, particularly in the US and the UK where income inequality has increased greatly . If relative income matters, one must reconsider the notion of a Pareto improvement, which is basic to public policy decisions. By the same token, distributional issues are central to any discussion about the costs and benefits of growth, an issue suggested not merely by the ‘happiness’ literature but by much recent writing on social capital, co-operative surviv al strategies the like. Nor is there a simple trade-off between efficiency and equity, since the two may be complementary. The neo-classical theory of factor rewards cannot justify current inequality since, upon closer examination, it is tautological and incoherent. The conclusion is that economists would do better to seek guidance on distributional matters from Rawlsian-type political theory.
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- Alberto F. Alesina & Edward L. Glaeser & Bruce Sacerdote, 2006.
"Work and Leisure in the U.S. and Europe: Why So Different?,"
in: NBER Macroeconomics Annual 2005, Volume 20, pages 1-100
National Bureau of Economic Research, Inc.
- Alesina, Alberto F & Glaeser, Edward L & Sacerdote, Bruce, 2005. "Work and Leisure in the US and Europe: Why So Different?," CEPR Discussion Papers 5140, C.E.P.R. Discussion Papers.
- Alberto Alesina & Edward L. Glaeser & Bruce Sacerdote, 2005. "Work and Leisure in the U.S. and Europe: Why So Different?," NBER Working Papers 11278, National Bureau of Economic Research, Inc.
- Alberto Alesina & Edward Glaeser & Bruce Sacerdote, 2005. "Work and Leisure in the U. S. and Europe: Why so Different?," Harvard Institute of Economic Research Working Papers 2068, Harvard - Institute of Economic Research.
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