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Comparing the Global and Merged with the Local and Separate: On a Downside to the Integration of Regions and Nations

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  • Stark, Oded

    (Universities of Bonn and Warsaw)

Abstract

This paper looks at the integration of regions and nations through the prism of the merger of populations (societies). The paper employs a particular index of social stress. Stylized examples of the merging of two populations suggest that with integration, the social stress index will increase. The examples form the basis for the development of new formulas for calculating the social stress of an integrated population as a function of the levels of social stress of the constituent populations when apart. The formulas reveal that the social stress of an integrated population is higher than the sum of the levels of social stress of the constituent populations when apart. This raises the distinct possibility that the merging of populations may be a social liability: integration may fail to give the populace a sense of improved wellbeing.

Suggested Citation

  • Stark, Oded, 2015. "Comparing the Global and Merged with the Local and Separate: On a Downside to the Integration of Regions and Nations," East Asian Economic Review, Korea Institute for International Economic Policy, vol. 19(4), pages 325-355, December.
    • Handle: RePEc:ris:eaerev:0019
    DOI: 10.11644/KIEP.JEAI.2015.19.4.300
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    References listed on IDEAS

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    1. Stark, Oded & Fan, C. Simon, 2011. "Migration for degrading work as an escape from humiliation," Journal of Economic Behavior & Organization, Elsevier, vol. 77(3), pages 241-247, March.
    2. Andrew E. Clark & Paul Frijters & Michael A. Shields, 2008. "Relative Income, Happiness, and Utility: An Explanation for the Easterlin Paradox and Other Puzzles," Journal of Economic Literature, American Economic Association, vol. 46(1), pages 95-144, March.
    3. C. Simon Fan & Oded Stark, 2007. "A Social Proximity Explanation of the Reluctance to Assimilate," Kyklos, Wiley Blackwell, vol. 60(1), pages 55-63, February.
    4. Oded Stark & Walter Hyll, 2011. "On the Economic Architecture of the Workplace: Repercussions of Social Comparisons among Heterogeneous Workers," Journal of Labor Economics, University of Chicago Press, vol. 29(2), pages 349-375.
    5. Qiu, Larry D. & Zhou, Wen, 2006. "International mergers: Incentives and welfare," Journal of International Economics, Elsevier, vol. 68(1), pages 38-58, January.
    6. Zeng, Dao-Zhi & Zhao, Laixun, 2010. "Globalization, interregional and international inequalities," Journal of Urban Economics, Elsevier, vol. 67(3), pages 352-361, May.
    7. Stark, Oded & Jakubek, Marcin, 2013. "Integration as a catalyst for assimilation," International Review of Economics & Finance, Elsevier, vol. 28(C), pages 62-70.
    8. Francisco L. Rivera-Batiz & Luis A. Rivera-Batiz, 2018. "Economic Integration and Endogenous Growth," World Scientific Book Chapters, in: Francisco L Rivera-Batiz & Luis A Rivera-Batiz (ed.), International Trade, Capital Flows and Economic Development, chapter 1, pages 3-32, World Scientific Publishing Co. Pte. Ltd..
    9. Francisco L. Rivera-Batiz & Luis A. Rivera-Batiz, 2018. "Integration among Unequals," World Scientific Book Chapters, in: Francisco L Rivera-Batiz & Luis A Rivera-Batiz (ed.), International Trade, Capital Flows and Economic Development, chapter 4, pages 83-104, World Scientific Publishing Co. Pte. Ltd..
    10. Behrens, Kristian & Gaigne, Carl & Ottaviano, Gianmarco I.P. & Thisse, Jacques-Francois, 2007. "Countries, regions and trade: On the welfare impacts of economic integration," European Economic Review, Elsevier, vol. 51(5), pages 1277-1301, July.
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    12. Greenaway, David & Gullstrand, Joakim & Kneller, Richard, 2008. "Surviving globalisation," Journal of International Economics, Elsevier, vol. 74(2), pages 264-277, March.
    13. van Elkan, Rachel, 1996. "Catching up and slowing down: Learning and growth patterns in an open economy," Journal of International Economics, Elsevier, vol. 41(1-2), pages 95-111, August.
    14. Stark, Oded & Fan, C. Simon, 2006. "A Reluctance to Assimilate," Discussion Papers 7125, University of Bonn, Center for Development Research (ZEF).
    15. Bossert, Walter & D'Ambrosio, Conchita, 2006. "Reference groups and individual deprivation," Economics Letters, Elsevier, vol. 90(3), pages 421-426, March.
    16. Shlomo Yitzhaki, 1979. "Relative Deprivation and the Gini Coefficient," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 93(2), pages 321-324.
    17. John D. Hey & Peter J. Lambert, 1980. "Relative Deprivation and the Gini Coefficient: Comment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 95(3), pages 567-573.
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    Cited by:

    1. Stark, Oded, 2021. "Why reducing relative deprivation but not reducing income inequality might bring down COVID-19 infections," Journal of Government and Economics, Elsevier, vol. 4(C).

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    More about this item

    Keywords

    Integration of Regions and Nations; Merging Populations; Social Welfare;
    All these keywords.

    JEL classification:

    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • F55 - International Economics - - International Relations, National Security, and International Political Economy - - - International Institutional Arrangements
    • P51 - Political Economy and Comparative Economic Systems - - Comparative Economic Systems - - - Comparative Analysis of Economic Systems

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