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Size and distribution trade-offs for the leximin ordering

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  • Bart Capéau

Abstract

A relative invariant and an absolute invariant inequality ordering satisfying extreme bottom-sensitivity, are proposed. It is shown that the leximin social welfare ordering can be expressed in terms of a ranking of distributions on the sole basis of their size, measured by the mean, and the degree of inequality, measured according to these inequality concepts. Leximin thus exhibits extreme bottom-sensitivity. This property does not withstand that leximin prefers a larger size of the cake at the cost of higher inequality in a number of cases. These trade-offs between size and equality are characterised in terms of degrees of dominance of the lower parts of the ordinary and absolute Lorenz curves that are accepted by leximin for a given increase in the mean. Copyright Springer Science+Business Media, LLC. 2013

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  • Bart Capéau, 2013. "Size and distribution trade-offs for the leximin ordering," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 11(2), pages 237-248, June.
    • Handle: RePEc:kap:jecinq:v:11:y:2013:i:2:p:237-248
    DOI: 10.1007/s10888-012-9219-2
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    More about this item

    Keywords

    Extreme bottom-sensitivity; Inequality ordering; Leximin; Lorenz curves; Social welfare ordering; D60; D63;
    All these keywords.

    JEL classification:

    • D60 - Microeconomics - - Welfare Economics - - - General
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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