Banks, James; Blundell, Richard; Lewbel, Arthur - In: Economic Journal 106 (1996) 438, pp. 1227-41
The exact measurement of the welfare costs of tax and price reform requires a detailed knowledge of individual … preferences. Typically, first-order approximations of welfare costs are calculated avoiding detailed knowledge of substitution … effects. The authors derive second-order approximations which, unlike first-order approximations, require knowledge of the …