The Potential Compensation Principle and Constant Marginal Utility of Income

IF 16.4 1区化学 Q1 CHEMISTRY, MULTIDISCIPLINARY

Accounts of Chemical Research Pub Date : 2019-08-18 DOI:10.1111/jere.12240

Stephen Martin

引用次数: 2

Abstract

In policy applications, industrial economists are wont to invoke the Kaldor–Hicks potential compensation principle to justify the use of deadweight loss as a measure of the welfare cost of market power. This usage rests on two assumptions. One of these assumptions, that changes in consumer and producer surplus are weighted equally, is well understood. The other assumption, that the marginal utility of income is constant, receives less attention. In a simple model, I show that if there is decreasing marginal utility of income, the use of deadweight loss as an index of market performance rests on shaky ground.

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潜在补偿原则与收入的恒定边际效用

在政策应用中，工业经济学家习惯于援引卡尔多-希克斯潜在补偿原则来证明将无谓损失作为衡量市场力量的福利成本的方法是合理的。这种用法基于两个假设。其中一个假设是，消费者剩余和生产者剩余的变化权重相等，这一点很好理解。另一种假设，即收入的边际效用是恒定的，受到的关注较少。在一个简单的模型中，我表明，如果收入的边际效用在减少，那么将无谓损失作为市场表现的指标就站不住脚了。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

Accounts of Chemical Research 化学-化学综合

CiteScore

31.40

自引率

1.10%

发文量

312

审稿时长

2 months

期刊介绍： Accounts of Chemical Research presents short, concise and critical articles offering easy-to-read overviews of basic research and applications in all areas of chemistry and biochemistry. These short reviews focus on research from the author’s own laboratory and are designed to teach the reader about a research project. In addition, Accounts of Chemical Research publishes commentaries that give an informed opinion on a current research problem. Special Issues online are devoted to a single topic of unusual activity and significance. Accounts of Chemical Research replaces the traditional article abstract with an article "Conspectus." These entries synopsize the research affording the reader a closer look at the content and significance of an article. Through this provision of a more detailed description of the article contents, the Conspectus enhances the article's discoverability by search engines and the exposure for the research.