The Equilibrium Distribution of Income and the Market for Status
This paper explores the implications for risk‐taking behavior and the equilibrium distribution of income of assuming that the desire for status positions is a powerful motive and that it raises the marginal utility of consumption. In contrast to previous analyses, we consider the case in which statu...
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| Veröffentlicht in: | The Journal of political economy 2005-04, Vol.113 (2), p.282-310 |
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| container_end_page | 310 |
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| container_title | The Journal of political economy |
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| creator | Becker, Gary S. Murphy, Kevin M. Werning, Iván |
| description | This paper explores the implications for risk‐taking behavior and the equilibrium distribution of income of assuming that the desire for status positions is a powerful motive and that it raises the marginal utility of consumption. In contrast to previous analyses, we consider the case in which status positions are sold in a hedonic market. We show that such a complete hedonic market in status positions can be perfectly replicated by a simpler arrangement with a “status good” and a social norm that assigns higher status to those that consume more of this good. The main result is that for a wide range of initial conditions the equilibrium distribution over income, status, and consumption is the same, that this allocation requires inequality of income and consumption, and that this allocation coincides with the optimum of a utilitarian planner. |
| doi_str_mv | 10.1086/427463 |
| format | Article |
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The main result is that for a wide range of initial conditions the equilibrium distribution over income, status, and consumption is the same, that this allocation requires inequality of income and consumption, and that this allocation coincides with the optimum of a utilitarian planner.</description><subject>Consumer economics</subject><subject>Consumer equilibrium</subject><subject>Consumption</subject><subject>Diminishing marginal utility</subject><subject>Economic theory</subject><subject>Economists</subject><subject>Encyclopedias</subject><subject>Endowments</subject><subject>Equilibrium</subject><subject>Income</subject><subject>Income distribution</subject><subject>Income inequality</subject><subject>Income redistribution</subject><subject>Inequality</subject><subject>Lotteries</subject><subject>Marginal utility</subject><subject>Market</subject><subject>Market equilibrium</subject><subject>Philosophers</subject><subject>Political economy</subject><subject>Social status</subject><subject>Socioeconomic factors</subject><subject>Status</subject><subject>Studies</subject><subject>Utility functions</subject><issn>0022-3808</issn><issn>1537-534X</issn><fulltext>true</fulltext><rsrctype>article</rsrctype><creationdate>2005</creationdate><recordtype>article</recordtype><recordid>eNpdkEtPwzAQhC0EEqXAL-AQIcQtYMfP3EClQFERB4rELXJdh7okcevHgX-PUVBB3cse5tPs7ABwiuAVgoJdk4IThvfAAFHMc4rJ-z4YQFgUORZQHIIj71cwDYJ4AG5mS52NN9E0Zu5MbLM744Mz8xiM7TJbZ5NO2VZnsltkIaHP0n3qkNXWZa9BhuiPwUEtG69PfvcQvN2PZ6PHfPryMBndTnNFBAy5TpEgVotScCaUYgKShUISC1RzKQRiXAkKMcEM0nktJUKIkUJpXpeMMMjwEFz2vmtnN1H7ULXGK900stM2-ir9xikqcALPd8CVja5L2SpUUoILwf65KWe9d7qu1s600n1VCFY_LVZ9iwk860HtjNpC4ydWcshhki96OaqlUfLDrp32_u_irsvKB-u2NphSilKab4FDgDY</recordid><startdate>20050401</startdate><enddate>20050401</enddate><creator>Becker, Gary S.</creator><creator>Murphy, Kevin M.</creator><creator>Werning, Iván</creator><general>The University of Chicago Press</general><general>University of Chicago Press, Journals Division</general><general>University of Chicago, acting through its Press</general><scope>7SW</scope><scope>BJH</scope><scope>BNH</scope><scope>BNI</scope><scope>BNJ</scope><scope>BNO</scope><scope>ERI</scope><scope>PET</scope><scope>REK</scope><scope>WWN</scope><scope>AAYXX</scope><scope>CITATION</scope><scope>8BJ</scope><scope>FQK</scope><scope>JBE</scope></search><sort><creationdate>20050401</creationdate><title>The Equilibrium Distribution of Income and the Market for Status</title><author>Becker, Gary S. ; 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| ispartof | The Journal of political economy, 2005-04, Vol.113 (2), p.282-310 |
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| language | eng |
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| source | EBSCO Business Source Complete; University of Chicago Press Journals (Full run); JSTOR |
| subjects | Consumer economics Consumer equilibrium Consumption Diminishing marginal utility Economic theory Economists Encyclopedias Endowments Equilibrium Income Income distribution Income inequality Income redistribution Inequality Lotteries Marginal utility Market Market equilibrium Philosophers Political economy Social status Socioeconomic factors Status Studies Utility functions |
| title | The Equilibrium Distribution of Income and the Market for Status |
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