Arbeitspapier

Relative income, redistribution and well-being

In a model with heterogeneous workers and both intensive and extensive margins of employment, we consider two systems of redistribution: a universal basic income, and a categorical unemployment benefit. Well-being depends on own-consumption relative to average employed workers' consumption, and concern for relativity is a parameter that affects model outcomes. While labour supply incurs positive marginal disutility, we allow negative welfare effects of unemployment. We also compare Rawlsian and utilitarian welfare in general equilibrium under the polar opposite transfer systems, with varying concern for relativity. Basic income Pareto dominates categorical benefits with moderate concern for relativity in both cases.

Sprache
Englisch

Erschienen in
Series: IZA Discussion Papers ; No. 5241

Klassifikation
Wirtschaft
Taxation, Subsidies, and Revenue: General
Market Structure, Pricing, and Design: General
Thema
relative income
redistribution
basic income
unemployment benefits
happiness
well-being

Ereignis
Geistige Schöpfung
(wer)
FitzRoy, Felix
Nolan, Michael
Ereignis
Veröffentlichung
(wer)
Institute for the Study of Labor (IZA)
(wo)
Bonn
(wann)
2010

Handle
Letzte Aktualisierung
10.03.2025, 11:43 MEZ

Datenpartner

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Objekttyp

  • Arbeitspapier

Beteiligte

  • FitzRoy, Felix
  • Nolan, Michael
  • Institute for the Study of Labor (IZA)

Entstanden

  • 2010

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