The well-known Baum-Eagon inequality I31 provides an effective iterative scheme for finding a local maximum for homogeneous polynomials with positive coefticients over a domain of probability values. However, in many applications we are interested in maximizing a general rational function. We extend the Baum-Eagon inequality to rational functions. We briefly describe some of the applications of...

How do workers make wage comparisons? Both an experimental study and an analysis of 16,000 British employees are reported. Satisfaction and well-being levels are shown to depend on more than simple relative pay. They depend upon the ordinal rank of an individual’s wage within a comparison group. ‘Rank’ itself thus seems to matter to human beings. Moreover, consistent with psychological theory, ...

Social Security in Belgium: Distributive Outcomes The paper analyzes the link between old-age income programs and economic outcomes in Belgium. We use a simulation methodology to construct an average pension generosity variable. Our regression analysis explores the link with distributional outcomes in income, consumption and more subjective indicators. Results document the weak link between ave...

The domain of polyconvex sets, i.e. finite unions of convex, compact, Euclidean sets, is large enough to encompass most of the opportunity sets typically encountered in economic environments, including non-linear or even non-convex budget sets, and opportunity sets arising from production sets. We provide a characterization of the volume-ranking as defined on the set of all polyconvex sets, rel...

This paper considers the functioning approach to the standard of living. It shows that, in evaluating standards of living, one is faced with deep-rooted tensions between the principle of minimal relativism, which requires some minimal respect for differences between the evaluations of different individuals and/or the differences between the norms of different communities, and the principle of d...

[2] I. Csiszar and J. Korner, Information Theory: Coding Theorems for Discrete Memotyless Systems. New York: Academic, to appear. [3] I. Csiszar, J. Komer, and K. Marton, “A New look at the error 1111 exponent of a discrete memoryless channel,” (preprint), presented at the IEEE Inf. Symp. on Inform. Theory, Ithaca, NY, Oct. IO14, [ 121 1977. [I31 [4] I. Csiszar and J. Komer, “Graph recompositio...

Much progress has been made in recent years in developing and applying a direct measure of utility using survey questions on satisfaction with income and with life in general. In this paper we apply this new type of measurement to the study of money illusion. Using data from the German Socio-Economic Panel for the years 1993 to 2003, we cannot reject the hypothesis of no money illusion. JEL Cla...