The design of an optimal tax schedule is examined using a structural labour supply model. The model incorporates unobserved heterogeneity, fixed costs of work, childcare costs and the detailed non-convexities of the tax and transfer system. The analysis concerns optimal design under social welfare functions with different degrees of inequality aversion. It also considers purely Pareto improving...

In this paper we conduct a multilevel analysis to examine how regional income inequality affects self-rated health in Japan based on two nationwide surveys. We confirm that prefecture-level income inequality significantly affects self-assessments of health by individuals, even after controlling for a broad set of both individual and regional variables. We also find that health assessment is mor...

D the payment scheme have an effect on inventory decisions in the newsvendor problem? Keeping the net profit structure constant, we examine three payment schemes that can be interpreted as the newsvendor’s order being financed by the newsvendor herself (scheme O), by the supplier through delayed order payment (scheme S), and by the customer through advanced revenue (scheme C). In a laboratory s...

Individuals’ preferences for risk and inequality are measured through choices between imagined societies and lotteries. The median relative risk aversion, which is often seen to reflect social inequality aversion, is between 2 and 3. Most people are also found to be individually inequality-averse, reflecting a willingness to pay for living in a more equal society. Left-wing voters and women are...

Heterogeneously risk-averse individuals who lack access to formal insurance build and use relationships with each other to manage risk. I show that the composition of equilibrium relationships under pairwise matching and when group size is endogenous is determined by a mean-variance trade-o¤ across di¤erentially risky productive opportunities, though output distributions may have in…nitely-many...

This note shows that for two inequality averse social welfare functions, if one is more inequality averse than the other, the household preference induced by optimally allocating aggregate bundles according to this social welfare function is more risk averse than the other. We present examples showing that this comparative static can be reversed if inequality aversion is dropped. We show that t...

Income Inequality and Job Satisfaction of Full-Time Employees in Germany Using data from the German Socio-Economic Panel Study (GSOEP), it is shown that income comparison with persons who are better off has a clear impact on the job satisfaction of West German full-time employees. Two contrary effects can be identified. On the one hand, there is an aversion to disadvantageous regional income in...

Gangs have played a significant role in Chicago’s social and political history, and continue to impact the city today, as gang violence rates continue to grow despite drops in overall crime[13]. In this paper, we explore the dynamics of gang involvement between at-risk individuals, gang members, and reformed (temporarily removed) gang members. We focus on the effect that reformed gang members h...

We assess the predictive power of a model of other-regarding preferences—inequality aversion—using a within-subjects design. We run four different experiments (ultimatum game, dictator game, sequential-move prisoners’ dilemma and public-good game) with the same sample of subjects. We elicit two parameters of inequality aversion to test several hypotheses across games. We find that within-subjec...