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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.

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  • Bart Capéau, 2012. "Size and distribution trade-offs for the leximin ordering," ULB Institutional Repository 2013/357208, ULB -- Universite Libre de Bruxelles.
    • Handle: RePEc:ulb:ulbeco:2013/357208
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    References listed on IDEAS

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    More about this item

    Keywords

    Extreme bottom-sensitivity Inequality ordering Leximin Lorenz curves Social welfare ordering;

    JEL classification:

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

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