Universität zu Köln

Bargain, Olivier, Decoster, Andre, Dolls, Mathias, Neumann, Dirk, Peichl, Andreas and Siegloch, Sebastian (2013). Welfare, labor supply and heterogeneous preferences: evidence for Europe and the US. Soc Choice Welf., 41 (4). S. 789 - 818. NEW YORK: SPRINGER. ISSN 1432-217X

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Abstract

Following the report of the Stiglitz Commission, measuring and comparing well-being across countries has gained renewed interest. Yet, analyses that go beyond income and incorporate non-market dimensions of welfare most often rely on the assumption of identical preferences to avoid the difficulties related to interpersonal comparisons. In this paper, we suggest an international comparison based on individual welfare rankings that fully retain preference heterogeneity. Focusing on the consumption-leisure trade-off, we estimate discrete choice labor supply models using harmonized microdata for 11 European countries and the US. We retrieve preference heterogeneity within and across countries and analyze several welfare criteria which take into account that differences in income are partly due to differences in tastes. The resulting welfare rankings clearly depend on the normative treatment of preference heterogeneity with alternative metrics. We show that these differences can indeed be explained by estimated preference heterogeneity across countries-rather than demographic composition.

Item Type:	Journal Article
Creators:	Creators Email ORCID ORCID Put Code Bargain, Olivier UNSPECIFIED UNSPECIFIED UNSPECIFIED Decoster, Andre UNSPECIFIED UNSPECIFIED UNSPECIFIED Dolls, Mathias UNSPECIFIED UNSPECIFIED UNSPECIFIED Neumann, Dirk UNSPECIFIED UNSPECIFIED UNSPECIFIED Peichl, Andreas UNSPECIFIED UNSPECIFIED UNSPECIFIED Siegloch, Sebastian UNSPECIFIED UNSPECIFIED UNSPECIFIED
URN:	urn:nbn:de:hbz:38-475125
DOI:	10.1007/s00355-012-0707-x
Journal or Publication Title:	Soc Choice Welf.
Volume:	41
Number:	4
Page Range:	S. 789 - 818
Date:	2013
Publisher:	SPRINGER
Place of Publication:	NEW YORK
ISSN:	1432-217X
Language:	English
Faculty:	Unspecified
Divisions:	Unspecified
Subjects:	no entry
Uncontrolled Keywords:	Keywords Language TAX REFORMS; FLAT TAX; CHOICE; RESPONSES; QUANTITY; DISCRETE; UTILITY; MODELS Multiple languages Economics; Social Sciences, Mathematical Methods Multiple languages
URI:	http://kups.ub.uni-koeln.de/id/eprint/47512