Income comparisons are important for individual well-being. We examine the shape of the relationship between relative income and life satisfaction, and test empirically if the features of the value function of prospect theory carry on to experienced utility. We draw on a unique dataset for a...

Do individuals choose their reference groups, i.e. their Joneses, or are they culturally transmitted across generations? We provide evidence that feeds the theoretical debate about the endogeneity or exogeneity of reference groups. Our findings for Uruguay suggest that reference groups are...

Do individuals choose their reference groups, i.e. their Joneses, or are they culturally transmitted across generations? We provide evidence that feeds the theoretical debate about the endogeneity or exogeneity of reference groups. Our findings for Uruguay suggest that reference groups are...

Starting from the axiomatisation of polarisation contained in Esteban and Ray (1994) and Chakravarty and Majumdar (2001) we investigate wheather paople's perceptions of income polarisation is consistent with the key axioms. This is carried out using a questionnaire-experimental approach that...

In the context of income dynamics, we investigate whether aspects of agents’ superior information relative to the econometrician’s limited information are captured in subjective expectations data. It is natural, for instance, to assume that the econometrician cannot observe idiosyncratic...

Economic theory and empirical evidence clearly show that social exclusion dimensions are inter-related. Notwithstanding that, dimensions are usually assumed independent from one another in the economics literature. In this paper we explore the inter-dependency of social exclusion dimensions and...

In this paper I decompose the monthly earnings of male full-time employees into their permanent and transitory components, using the British Household Panel Study for the period 1991-95. Cross-section evidence points at a positive message: the increasing earnings inequality trend of the 1980s is...

This paper draws on the first four waves of data of the British Household Panel Survey (BHPS) to analyse the statics and dynamics of the earnings distribution in the early nineties. Motivated by the wide range of concerns which mobility is viewed to serve, I analyse mobility under three...

This paper draws on the first four waves of data of the British Household Panel Survey (BHPS) to analyse the statics and dynamics of the earnings distribution in the early nineties. Motivated by the wide range of concerns which mobility is viewed to serve, I analyse mobility under three...

We study wage effects of two important elements of non-wage labour costs: firing costs and payroll taxes. We exploit a reform that introduced substantial reduction in these two provisions for unemployed workers aged less than thirty and over forty five years. Theoretical insights are gained with...