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Stressful Integration

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  • Stark, Oded

Abstract

This paper considers the integration of economies as a merger of populations. The premise is that the merger of groups of people alters their social landscape and their comparators. The paper identifies the effect of the merger on aggregate distress. A merger is shown to increase aggregate distress, measured as total relative deprivation: the social distress of a merged population is greater than the sum of the social distress of the constituent populations when apart. Physiological evidence from neighboring disciplines points to an increase in societal stress upon merger.

Suggested Citation

  • Stark, Oded, 2013. "Stressful Integration," Discussion Papers 150233, University of Bonn, Center for Development Research (ZEF).
    • Handle: RePEc:ags:ubzefd:150233
    DOI: 10.22004/ag.econ.150233
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    File URL: https://ageconsearch.umn.edu/record/150233/files/DP179.pdf
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    References listed on IDEAS

    as
    1. Easterlin, Richard A. & Plagnol, Anke C., 2008. "Life satisfaction and economic conditions in East and West Germany pre- and post-unification," Journal of Economic Behavior & Organization, Elsevier, vol. 68(3-4), pages 433-444, December.
    2. 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.
    3. Oded Stark, 2010. "Looking at the Integration of Nations through the Lens of the Merger of Populations: Preliminary Superadditivity and Impossibility Results," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 146(IV), pages 661-675, December.
    4. Henrekson, Magnus & Torstensson, Johan & Torstensson, Rasha, 1997. "Growth effects of European integration," European Economic Review, Elsevier, vol. 41(8), pages 1537-1557, August.
    5. 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.
    6. Oded Stark & Walter Hyll & Yong Wang, 2012. "Endogenous Selection of Comparison Groups, Human Capital Formation, and Tax Policy," Economica, London School of Economics and Political Science, vol. 79(313), pages 62-75, January.
    7. AndrewE. Clark & Claudia Senik, 2010. "Who Compares to Whom? The Anatomy of Income Comparisons in Europe," Economic Journal, Royal Economic Society, vol. 120(544), pages 573-594, May.
    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. Frey, Bruno S & Stutzer, Alois, 2000. "Happiness, Economy and Institutions," Economic Journal, Royal Economic Society, vol. 110(466), pages 918-938, October.
    10. Alberto Alesina & Nichola Fuchs Schuendeln, 2005. "Good bye Lenin (or not?): The Effect of Communism on People's Preferences," NBER Working Papers 11700, National Bureau of Economic Research, Inc.
    11. 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.
    12. Giacomo Corneo, 2001. "Inequality and the State: Comparing US and German Preferences," Annals of Economics and Statistics, GENES, issue 63-64, pages 283-296.
    13. Bruno S. Frey, 2018. "Economics of Happiness," SpringerBriefs in Economics, Springer, number 978-3-319-75807-7, October.
    14. Erzo F. P. Luttmer, 2005. "Neighbors as Negatives: Relative Earnings and Well-Being," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 120(3), pages 963-1002.
    15. Oded Stark & Franz Rendl & Marcin Jakubek, 2012. "The merger of populations, the incidence of marriages, and aggregate unhappiness," Journal of Evolutionary Economics, Springer, vol. 22(2), pages 331-344, April.
    16. Bossert, Walter & D'Ambrosio, Conchita, 2006. "Reference groups and individual deprivation," Economics Letters, Elsevier, vol. 90(3), pages 421-426, March.
    17. C. Simon Fan & Oded Stark, 2011. "A Theory Of Migration As A Response To Occupational Stigma," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 52(2), pages 549-571, May.
    18. 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.
    19. David Andolfatto, 2002. "A Theory of Inalienable Property Rights," Journal of Political Economy, University of Chicago Press, vol. 110(2), pages 382-393, April.
    20. repec:hal:pseose:halshs-00754447 is not listed on IDEAS
    21. 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.
    22. repec:adr:anecst:y:2001:i:63-64:p:14 is not listed on IDEAS
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    Citations

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    Cited by:

    1. Stark, Oded & Jakubek, Marcin & Falniowski, Fryderyk, 2014. "Reconciling the Rawlsian and the utilitarian approaches to the maximization of social welfare," Economics Letters, Elsevier, vol. 122(3), pages 439-444.
    2. Oded Stark & Ewa Zawojska, 2016. "Will a government find it financially easier to neutralize a looming protest if more groups are involved?," Constitutional Political Economy, Springer, vol. 27(4), pages 435-450, December.
    3. Stark, Oded, 2014. "A policy response to a downside of the integration of economies: An impossibility theorem," Economics Letters, Elsevier, vol. 124(2), pages 180-184.
    4. Oded Stark & Fryderyk Falniowski & Marcin Jakubek, 2017. "Consensus Income Distribution," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 63(4), pages 899-911, December.
    5. Stark, Oded & Zawojska, Ewa & Kohler, Wilhelm & Szczygielski, Krzysztof, 2018. "An adverse social welfare effect of a doubly gainful trade," Journal of Development Economics, Elsevier, vol. 135(C), pages 77-84.
    6. Oded Stark & Wiktor Budzinski & Grzegorz Kosiorowski, 2019. "The pure effect of social preferences on regional location choices: The evolving dynamics of convergence to a steady state population distribution," Journal of Regional Science, Wiley Blackwell, vol. 59(5), pages 883-909, November.
    7. Stark, Oded & Jakubek, Marcin & Kobus, Martyna, 2015. "Engineering an incentive to search for work: A comparison groups approach," Economics Letters, Elsevier, vol. 132(C), pages 1-4.
    8. Stark, Oded & Zawojska, Ewa, 2015. "Gender differentiation in risk-taking behavior: On the relative risk aversion of single men and single women," Economics Letters, Elsevier, vol. 137(C), pages 83-87.
    9. Oded Stark, 2017. "Migration when Social Preferences are Ordinal: Steady-state Population Distribution and Social Welfare," Economica, London School of Economics and Political Science, vol. 84(336), pages 647-666, October.
    10. Stark, Oded, 2017. "Possible Policy Responses to a Dark Side of the Integration of Regions and Nations," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, pages 329-341.
    11. Oded Stark & Marcin Jakubek & Martyna Kobus, 2015. "A bitter choice turned sweet: How acknowledging individuals’ concern at having a low relative income serves to align utilitarianism and egalitarianism," Journal of Evolutionary Economics, Springer, vol. 25(3), pages 541-557, July.
    12. Poczta_Wajda, Agnieszka, 2015. "Feeling of Relative Deprivation as a Driver for Higher Agricultural Subsidies," Problems of World Agriculture / Problemy Rolnictwa Światowego, Warsaw University of Life Sciences, vol. 15(30), pages 1-10, December.
    13. Poczta-Wajda, Agnieszka, 2015. "Why ‟Rich Farmers” Demand Financial Support?," Roczniki (Annals), Polish Association of Agricultural Economists and Agribusiness - Stowarzyszenie Ekonomistow Rolnictwa e Agrobiznesu (SERiA), vol. 2015(4), August.

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    More about this item

    Keywords

    Community/Rural/Urban Development; Institutional and Behavioral Economics; Labor and Human Capital; Productivity Analysis;
    All these keywords.

    JEL classification:

    • D04 - Microeconomics - - General - - - Microeconomic Policy: Formulation; Implementation; Evaluation
    • 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
    • H53 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Welfare Programs
    • P51 - Political Economy and Comparative Economic Systems - - Comparative Economic Systems - - - Comparative Analysis of Economic Systems

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