A transfer from a richer individual to poorer A transfer from a richer individual to poorer seems to be the most seems to be the most intuitive and straightforward way of reducing income inequality in a society. However, can such a transfer reduce the welfare of the society? We show that a rich...

In this paper I study policy responses to an increase in post-merger distress. I consider the integration of regions and nations as a merger of populations which I view as a revision of social space, and I identify the effect of the merger on aggregate distress. The paper is based on the premise...

This paper considers the integration of economies as a merger of populations. The premise is that the merger of groups of people alters their social landscape and their comparators. The paper identifies the effect of the merger on aggregate distress. A merger is shown to increase aggregate...

Recent research shows that the merger of economies increases aggregate stress. This paper shows that there is no income distribution policy which will ensure that the wellbeing of the individuals belonging to merging economies does not fall below their pre-merger level.

It stands to reason that social unrest does not erupt out of the blue. Although there are a great many reasons why social dismay might descend into social disorder, only few yardsticks or indices can plausibly be used to gauge the potential for social unrest (PSU). If policy makers want to...

I study the integration of regions in the form of a merger of populations, which I interpret as a revision of people's social space and their comparison set; I illustrate the way in which a merger can aggravate social distress; and I consider policy responses. Specifically, I view the merger of...

When individuals’ utility is a convex combination of their income and their concern at having a low relative income (the weights attached to income and to the concern at having a low relative income sum up to one), the maximization of aggregate utility yields an equal income distribution. This...

We demonstrate that a rank-preserving transfer from a richer individual to a poorer individual can exacerbate income inequality (when inequality is measured by the Gini coefficient). This happens when individuals' preferences depend negatively not only on work time (effort) but also on low...

This paper argues that an increase in the inequality of wealth prompts a stronger quest for status that in turn fosters the accumulation of wealth. It proposes a measure for an individual’s want of social status. For a given level of a population’s wealth, the corresponding aggregate measure...