Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/196828 
Year of Publication: 
2019
Series/Report no.: 
IZA Discussion Papers No. 12331
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
This paper tracks the consequences of individuals' desire to align their location with their social preferences. The social preference studied in the paper is distaste for relative deprivation, measured in a cardinal manner. Location is conceived as social space, with individuals choosing to relocate if, as a result, their relative deprivation will be reduced, holding their incomes constant. Conditions are provided under which the associated dynamics reaches a spatial steady state, the number of periods it takes to reach a steady state is specified, and light is shed on the robustness of the steady state outcome. By way of simulation it is shown that for large populations, a steady state of the relocation dynamics is almost always reached, typically in one period, and that cycles are more likely to occur when the populations' income distributions are more equal.
Subjects: 
social preferences
distaste for low relative income
a cardinal measure of income relative deprivation
interregional locational choices
relocation dynamics
steady-state spatial distribution
JEL: 
C62
C63
R12
R13
Z13
Document Type: 
Working Paper

Files in This Item:
File
Size
304.2 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.