Aggregate Deadweight Loss and Money Metric Social Welfare  

Oleh:

Slesnick, Daniel T.

Jenis: Article from Bulletin/Magazine
Dalam koleksi: INTERNATIONAL ECONOMIC REVIEW vol. 32 no. 1 (1991), page 123-146.
Topik: AGGREGATE; aggregate; deadweight loss; money metric; social welfare

Ketersediaan

Perpustakaan Pusat (Semanggi) Nomor Panggil: II49 Non-tandon: 1 (dapat dipinjam: 0) Tandon: tidak ada

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Isi artikel

An econometric approach to the measurement of aggregate deadweight loss is proposed which does not require restrictive assumptions about preferences for validity. The measure can be interpreted as the loss in allocative efficiency and is independent of the distribution of individual welfare. An approach which is pervasive in the literature is to sum the individual measures of deadweight loss and interpret the resulting index as a measure of social welfare. We show that this approach is invalid unless individual preferences or the social ordering are severely restricted. An alternative method of evaluating money metric social welfare which does not require these restrictions is presented.

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