Abstract
We compute the Gini indexes for income, happiness and various simulated utility levels. Due to decreasing marginal utility
of income, happiness inequality should be lower than income inequality. We find that happiness inequality is about half that
of income inequality. To compute the utility levels we need to assume values for a key parameter that can be interpreted as
a measure of relative risk aversion. If this coefficient is above one, as many economists believe, then a large part of happiness
inequality is not related to pecuniary dimensions of life.
of income, happiness inequality should be lower than income inequality. We find that happiness inequality is about half that
of income inequality. To compute the utility levels we need to assume values for a key parameter that can be interpreted as
a measure of relative risk aversion. If this coefficient is above one, as many economists believe, then a large part of happiness
inequality is not related to pecuniary dimensions of life.
- Content Type Journal Article
- Pages 1-13
- DOI 10.1007/s11205-011-9929-z
- Authors
- Néstor Gandelman, Universidad ORT Uruguay, Bulevar España 2633, 11300 Montevideo, Uruguay
- Rafael Porzecanski, University of California at Los Angeles, Los Angeles, CA, USA
- Journal Social Indicators Research
- Online ISSN 1573-0921
- Print ISSN 0303-8300