This paper empirically investigates to what extent individuals vote with their pocketbooks in income redistribution. Survey data on preferences for redistribution show significant deviations from pocketbook voting in the poorest and the richest income groups. Differences in income status, education status, and other factors related to perceived social mobility cannot fully explain cross-country...

This article studies the optimal use of fines and imprisonment when an offender’s level of wealth cannot be observed by the enforcement authority. I employ a model in which there are two types of offenders — a low-wealth type and a high-wealth type. The consequence of the unobservability of wealth depends on whether the enforcement authority would employ fines alone, or would also impose impris...

Studying Justice: Measurement, Estimation, and Analysis of the Actual Reward and the Just Reward This paper describes procedures for measuring and estimating the fundamental quantities in the study of distributive justice. We examine a variety of methods for measuring the actual reward and the just reward, for both self and other, including direct and indirect methods for measuring the just rew...

This paper studies the tensions between egalitiarian sentiments, equity concerns, self-interest, and the need for incentives in a society. We propose an experimental game in which subjects can assign their endowment to private or (more efficient) group production activities, with the proceeds from group activity divided either equally, in proportion to contribution, or by combination of the two...

Opportunity-Sensitive Poverty Measurement We axiomatically characterize two classes of poverty measures which are sensitive to inequality of opportunity – one a strict subset of the other. The proposed indices are sensitive not only to income shortfalls from the poverty line, but also to differences in opportunities faced by people with different pre-determined characteristics, such as race or ...

The paper compares the well-being of the baby boom generation (ages 40–55) in 2001 with the same age group in 1983. I find little evidence that their relative position deteriorated over the period. By some indicators, this generation has seen an improvement. In terms of income, the 40–55 age group was at about the same relative position in 2001 as in 1983. In terms of conventional wealth, there...

The fact that minimum wages seem especially binding for young workers has led some countries to adopt age-differentiated minimum wages. We develop a dynamic competitive two-sector labor market model where workerswith heterogeneous initial skills gain productivity through experience.We compare two equally binding schemes of single and age-differentiated minimumwages, and find that although diffe...

This paper investigates empirically how similarity of demand structures – approximated by similarity of income distributions – affects trade patterns along both the extensive and intensive margin. The idea that similarity of demand structures intensifies trade goes back to the well-known Linder hypothesis. Based on a sample of 102 countries, I find that bilateral trade volumes are increasing in...

We examine the effects of changes in the income distribution in an economy where agents’ utility depends both on consumption and on their rank in the distribution of conspicuous consumption. We introduce a new methodology to compare the behavior of agents that occupy the same rank in the two different income distributions but typically have different levels of incomes. Here, an increase in inco...

Multidimensional Affluence: Theory and Applications to Germany and the US This paper suggests multidimensional affluence measures for the top of the distribution. In contrast to commonly used top income shares, they allow the analysis of the extent, intensity and breadth of affluence in several dimensions within a common framework. We illustrate this by analyzing the role of income and wealth a...