Income distribution, happiness and satisfaction: A direct test of the interdependent preferences model

This study utilizes social-psychological measures of happiness and satisfaction in order to test the interdependent preferences model. According to this class of models, in addition to individual characteristics, utility also depends on the well-being of other members of society. Happiness and satisfaction should therefore depend on the average income of society and its distribution among rich and poor. Canadian survey data are used to test this hypothesis. Results differ across alternative measures of subjective well-being. Holding personal characteristics constant, self-reported satisfaction is lower the larger the share of income going to the poorest 40% of the community. A 3-point scale of happiness yields similar results, but not an 11-point scale. The determinants of satisfaction and happiness differ systematically between men and women. Overall, the empirical results support the interdependent preferences model, but defy any simple characterization in terms of inequality aversion and relative economic status.     

A note on interdependent happiness

Based on two models of interdependent utilities [Becker, G., 1974. A theory of social interaction, Journal of Political Economy 82, 1064–1093; Fehr, E., Schmidt, K., 1999. A theory of fairness, competition, and cooperation, Quarterly Journal of Economics 114, 817–868] we derive a functional relationship between average happiness and the standard deviation of happiness within a country. This hypothesis is supported by an empirical investigation of 71 countries which shows that the average happiness in these countries depends only on income and on the standard deviation of happiness σ. The latter may be partly based on influences beyond income, for which no data are available. Income has the expected positive influence and σ has the expected negative influence, i.e. large differences in “autonomous” happiness have a dampening influence on “effective” happiness which also takes into account the happiness of others.     

The poverty of growth with interdependent utility functions

We argue that with interdependent utility functions growth can lead to a decline in total welfare of a society if the gains from growth are sufficiently unequally distributed in the presence of negative externalities in consumption, i.e. envy.     

Relative status and interdependent effects in consumer behavior

The current consumer culture, which associates the meaning of life primarily through the consumption of material goods and services, has brought many transformations in U.S. society. The purpose of this study is to examine the relative status and interdependent effects associated with consumer behavior, as developed by economists Veblen, Duesenberry, Frank, and Schor. Using the 2005 Consumer Expenditure Survey, several linear regression models have been conducted on four expenditure items including clothing, entertainment, home furnishings, and automobiles. While controlling for several demographic variables, a consumer's relative expenditure ranking emerges as the strongest substantive factor in determining clothing consumption and number of automobiles owned.     

Generalized Negatively Reinforced Manding in Children with Autism

Individuals with developmental disabilities are often unable to influence their social environment in traditional ways (i.e., vocal language) and frequently exhibit challenging behaviors (e.g., aggression and self-injury) because such behaviors were previously reinforced under similar conditions. While the area of positive reinforcement manding has been well-documented and empirically validated, there is less research in the area of negatively reinforced manding—particularly in the area of negatively reinforced manding of nonpreferred items. Using a multiple baseline design across participants, this study sought to teach three children with autism to replace their challenging behaviors with more socially appropriate ways to request the removal of nonpreferred items. Results showed that all participants were able to learn the negatively reinforced mand response and these mand responses were generalized to other untrained items. In addition to extending the research in the area, the study empirically defined a procedure for teaching negatively reinforced manding of nonpreferred items. Moreover, teaching the mand response resulted in quality of life improvements for all participants and their families.     

Characterizing Paretian preferences

A characterization of a property of binary relations is of type M if it can be stated in terms of ordered M-tuples of alternatives. A characterization of finite type provides an easy test of whether preferences over a large set of alternatives possesses the property characterized. Unfortunately, there is no characterization of finite type for Pareto representability in . A partial result along the same lines is obtained for Pareto representability in , k>2.

---

Interpersonal distance preferences

The utility of various curvilinear comfort models of interpersonal distance was examined in a study employing subjects' responses to a broad range of videotaped, seated distances. Results obtained provided considerable support for these models. Intermediate distances were rated as more comfortable, preferable, and appropriate than more extreme close or far distances. This pattern of results was manifested for interaction situations involving both two- and four-person groups.This research was supported by Grants #HD-07045 and HD-8546-01 from the National Institute of Child Health and Human Development and by a NIH Biomedical Research Support grant 5S07 RR07087-12.     

Confidence in preferences

Indeterminate preferences have long been a tricky subject for choice theory. One reason for which preferences may be less than fully determinate is the lack of confidence in one’s preferences. In this paper, a representation of confidence in preferences is proposed. It is used to develop and axiomatise an account of the role of confidence in choice which rests on the following intuition: the more important the decision to be taken, the more confidence is required in the preferences needed to take it. This theory provides a natural account of when an agent should defer a decision; namely, when the importance of the decision exceeds his confidence in the relevant preferences. Possible applications of the notion of confidence in preferences to social choice are briefly explored.     

Aggregation of coarse preferences

We consider weak preference orderings over a set A _n of n alternatives. An individual preference is of refinement?≤n if it first partitions A _n into ? subsets of `tied' alternatives, and then ranks these subsets within a linear ordering. When ?<n, preferences are coarse. It is shown that, if the refinement of preferences does not exceed ?, a super majority rule (within non-abstaining voters) with rate 1− 1/? is necessary and sufficient to rule out Condorcet cycles of any length. It is argued moreover how the coarser the individual preferences, (1) the smaller the rate of super majority necessary to rule out cycles `in probability'; (2) the more probable the pairwise comparisons of alternatives, for any given super majority rule. Received: 29 June 1999/Accepted: 25 February 2000     

Factorization of fuzzy preferences

In the ordinary framework, the factorization of a weak preference relation into a strict preference relation and an indifference relation is unique. However, in fuzzy set theory, the intersection and the union of fuzzy sets can be represented different ways. Furthermore, some equivalent properties in the ordinary case have generalizations in the fuzzy framework that may be not equivalent. For these reasons there exist in the literature several factorizations of a fuzzy weak preference relation. In this paper we obtain and characterize different factorizations of fuzzy weak preference relations by means of two courses of action which are equivalent in the ordinary framework: axioms and definitions of strict preference and indifference.This work is partially financed by the Junta de Castilla y León (Consejería de Educación y Cultura, Proyecto VA057/02), Ministerio de Ciencia y Tecnología, Plan Nacional de Investigación, Desarrollo e Innovación Tecnológica (I+D+I) (Proyecto BEC2001-2253) and ERDF. I am indebted to José Luis García-Lapresta and an anonymous referee for his helpful comments.     

Aggregation of smooth preferences

Suppose p is a smooth preference profile (for a society, N) belonging to a domain P ^N . Let σ be a voting rule, and σ(p)(x) be the set of alternatives in the space, W, which is preferred to x. The equilibrium E(σ(p)) is the set {x∈W:σ(p)(x) is empty}. A sufficient condition for existence of E(σ(p)) when p is convex is that a “dual”, or generalized gradient, dσ(p)(x), is non-empty at all x. Under certain conditions the dual “field”, dσ(p), admits a “social gradient field”Γ(p). Γ is called an “aggregator” on the domain P ^N if Γ is continuous for all p in P ^N . It is shown here that the “minmax” voting rule, σ, admits an aggregator when P ^N is the set of smooth, convex preference profiles (on a compact, convex topological vector space, W) and P ^N is endowed with a C ¹-topology. An aggregator can also be constructed on a domain of smooth, non-convex preferences when W is the compact interval. The construction of an aggregator for a general political economy is also discussed. Some remarks are addressed to the relationship between these results and the Chichilnisky-Heal theorem on the non-existence of a preference aggregator when P ^N is not contractible. Received: 4 July 1995 / Accepted: 26 August 1996     

Transitivity and fuzzy preferences

The authors would like to thank a referee at Social Choice and Welfare for insightful comments.     

Rent-seeking and competitive preferences

In this experiment, I examine the extent to which competitive social preferences can explain over-bidding in rent-seeking contests. The Human treatment is a standard two-player contest. In the Robot treatment, a single player bids against a computerized player, eliminating potential social preference motives. The results show no difference in bids between treatments at the aggregate level. Further analysis shows evidence of heterogeneous treatment effects between impulsive and reflective subjects. Moreover, impulsive subjects are more likely than reflective subjects to deviate qualitatively from the shape of the theoretical best response function.     

Modelling interactions among offenders: A latent space approach for interdependent ego-networks

Illegal markets are notoriously difficult to study. Police data offer an increasingly exploited source of evidence. However, their secondary nature poses challenges for researchers. A key issue is that researchers often have to deal with two sets of actors: targeted and non-targeted. This work develops a latent space model for interdependent ego-networks purposely created to deal with the targeted nature of police evidence. By treating targeted offenders as egos and their contacts as alters, the model (a) leverages on the full information available and (b) mirrors the specificity of the data collection strategy. The paper then applies this approach to analyse a real-world example of illegal markets, namely the smuggling of migrants. To this end, we utilise a novel dataset of 21,555 phone conversations wiretapped by the police to study interactions among offenders.     

Social choice with procedural preferences

Participants in an aggregation procedure have preferences not only over outcomes but also over procedural features (such as preferring consensus, preferring to be in the majority, preferring not having to compromise, etc.) Such procedural preferences can be expressed in a framework that, contrary to the traditional Arrovian framework, has voting patterns rather than outcomes as comparison classes. The extended framework helps us to resolve several of the puzzles of social choice theory. The (more or less anti-democratic) political conclusions that some author have been willing to draw from results in the Arrovian framework are shown to rely on formal restrictions that are present in that framework but not in the extended framework that is presented here.     

Justifiable preferences over opportunity sets

In this paper we say that a preference over opportunity sets is justifiable if there exists a reflexive and complete binary relation on the set of alternatives, such that one opportunity set is at least as good as a second, if and only if the there is at least one alternative from the first set which is no worse than any alternative of the two sets combined together, with respect to the binary relation on the alternatives. In keeping with the revered tradition set by von Neumann and Morgenstern we call a reflexive and complete binary relation, an abstract game (note: strictly speaking von Neumann and Morgenstern refer to the asymmetric part of a reflexive and complete binary relation as an abstract game; hence our terminology though analytically equivalent, leads to a harmless corruption of the original meaning). In this paper we obtain a necessary and sufficient condition for the justifiability of transitive and quasi transitive preferences over opportunity sets. I would like to thank Prasanta Pattanaik for motivation in this research. I would also like to thank Maurice Salles and an anonymous referee of this journal for useful suggestions leading to considerable improvement in the presentation. An earlier version of this paper was presented at the Sixth Annual Conference on Econometric Modeling for Africa, held at Pretoria from July 4–6, 2001. I would like to thank all the conference participants for their observations on my paper. However, the sole responsibility for errors that do remain is my own.     

Intertemporal stability of uncertainty preferences

We analyze the stability of ambiguity preferences experimentally, by repeatedly eliciting ambiguity attitudes towards multiple 3-color Ellsberg urns over a period of two months. 57% of the choices show stable preferences over this time period. This is significantly higher than random choices would suggest, but significantly lower than the level of consistency when measures are taken back-to-back (75%). Over the same time frame, we do not find a significant change in the consistency of risk preferences. For subjects who are able to recall their ambiguity decision after two months correctly, the share of consistent choices does not drop significantly over time.     

Using elections to represent preferences

This paper takes voting theory out of the realm of mechanism design and studies elections as tools for representing preferences: every preference relation on a set of n elements is the outcome of pairwise voting by approximately 2 log₂ n voters with transitive preferences. Results like this one provide representation for preference relations not representable by utility functions. They also motivate definitions of the levels of intransitivity, nonlinearity and nonrepresentability (by utility function) of a preference relation. Received: 25 March 1999/Accepted: 19 June 2000