Department of Economics. University of Melbourne. Parkville Victoria
3052 Australia
ABSTRACT
This paper measures individuals' attitudes to inequality aversion.
The data are collected from surveys, based on the leaky-bucket experiment,
of several groups of students in Australia and Israel. Three forms of social
welfare function are estimated. It is found that measures of inequality
aversion can be obtained with some precision and that these estimates are
substantially lower than the values typically used by those measuring inequality
and examining optimal tax structures. Furthermore, a welfare function based
on the Gini inequality measure is generally found to give a better fit
than forms based on constant relative or constant absolute inequality aversion.
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