Arbeitspapier
The Rotten Kid Theorem and Almost Transferable Utility
We assume like Bergstrom (1989) and Dijkstra (2007) that each child’s utility is treated as a normal good in the altruistic head’s utility function, and show that if utility functions lead to Almost Transferable Utility children can manipulate the tradeoff between their own utility and the parent’s utility through their own actions, but they have an incentive to maximize the altruistic head’s utility if the altruistic head also considers children’s utilities as Hicksian substitutes and hence the rotten kid theorem holds. A special class of such altruistic utility functions that treat utilities of children as normal and Hicksian substitutes are the Generalized Utilitarian Welfare functions.
- Language
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Englisch
- Bibliographic citation
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Series: CESifo Working Paper ; No. 5642
- Classification
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Wirtschaft
State and Local Government; Intergovernmental Relations: General
- Subject
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Rotten Kid Theorem
transferable utility
Hicksian substitutes
fiscal federalism
- Event
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Geistige Schöpfung
- (who)
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Gugl, Elisabeth
Leroux, Justin
- Event
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Veröffentlichung
- (who)
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Center for Economic Studies and ifo Institute (CESifo)
- (where)
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Munich
- (when)
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2015
- Handle
- Last update
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10.03.2025, 11:41 AM CET
Data provider
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Gugl, Elisabeth
- Leroux, Justin
- Center for Economic Studies and ifo Institute (CESifo)
Time of origin
- 2015
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Optimal Timing in Rotten Kid Families
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A utility representation theorem with weaker continuity condition
A utility representation theorem with weaker continuity condition
Quantile estimation based on the almost sure central limit theorem
An alternative proof for the linear utility representation theorem
The arbitrage Pricing Theorem with Non Expected Utility Preferences
Uniqueness of individual demand at almost every budget via Sard's theorem