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Identity, Envy and Resource Loss

Author

Listed:
  • Diganta Mukherjee

    (Sampling and Official Statistics Unit, Indian Statistical Institute, Kolkata 700 108, West Bengal, India)

Abstract

This paper looks at society divided into two groups where personal assets as well as group specific values influences the individuals' utility (positively for own group's value and possibly otherwise for the other group's value). Individual resource allocation problem may lead to under investment in production of assets and excessive diversion of resources into wasteful destructive activities. As a result, the net utility is lowered for all individuals. On the economic front, such usage of resource boosts the "black market" economy and results in dead weight loss. Because in equilibrium both the personal as well as social value created is smaller, on the social front these activities encourage social disintegration.

Suggested Citation

  • Diganta Mukherjee, 2015. "Identity, Envy and Resource Loss," International Game Theory Review (IGTR), World Scientific Publishing Co. Pte. Ltd., vol. 17(01), pages 1-13.
    • Handle: RePEc:wsi:igtrxx:v:17:y:2015:i:01:n:s0219198915400101
    DOI: 10.1142/S0219198915400101
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    References listed on IDEAS

    as
    1. Anirban Mitra & Debraj Ray, 2014. "Implications of an Economic Theory of Conflict: Hindu-Muslim Violence in India," Journal of Political Economy, University of Chicago Press, vol. 122(4), pages 719-765.
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    More about this item

    Keywords

    Conflict; envy; externality; identity; D31; D74;
    All these keywords.

    JEL classification:

    • B4 - Schools of Economic Thought and Methodology - - Economic Methodology
    • C0 - Mathematical and Quantitative Methods - - General
    • C6 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling
    • C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory
    • D5 - Microeconomics - - General Equilibrium and Disequilibrium
    • D7 - Microeconomics - - Analysis of Collective Decision-Making
    • M2 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics

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