Joan Esteban

Polarization: Concepts, Measurement, Estimation

The purpose of this paper is two-fold. First, we develop the measurement theory of polarization for the case in which asset distributions can be described using density functions. Second, we provide sample estimators of population polarization indices that can be used to compare polarization across time or entities. Distribution-free statistical inference results are also derived in order to ensure that the orderings of polarization across entities are not simply due to sampling noise. An illustration of the use of these tools using data from 21 countries shows that polarization and inequality orderings can often differ in practice.

Inequality, Lobbying, and Resource Allocation

This paper describes how wealth inequality may distort public resource allocation. A government seeks to allocate limited resources to productive sectors, but sectoral productivity is privately known by agents with vested interests in those sectors. They lobby the government for preferential treatment. The government—even if it honestly seeks to maximize economic efficiency—may be confounded by the possibility that both high wealth and true economic desirability create loud lobbies. Broadly speaking, both poorer economies and unequal economies display greater public misallocation. The paper warns against the conventional wisdom that this is so because such governments are more corrupt.

Polarization and Conflict: Theoretical and Empirical Issues

Recent formal and empirical research in political science and economics strongly indicates that various forms of political and social polarization increase the risk of violent conflict within and between nation states. The articles collected for this issue explore this crucial relationship and provide answers to a variety of topics: First, contributors address how institutions and other contingent factors mediate the conflict potential in polarized societies. Second, this special issue compares the explanatory power of income polarization with traditional and new measures of inequality. Third, the contributions examine how groups form and coalitions are built in polarized societies and how this affects political decision-making. Finally, the special issue analyses the interconnections between interstate war, internationalized conflict and polarization. This introduction synthesizes the literatures that have been developed on the issue of polarization and conflict in the various social scientific disciplines. The authors particularly discuss the similarities between economic models of conflict and the so-called crisis bargaining literature which has been mainly developed within political science. The article shows the differences between `polarization and `inequality and introduces the various measures of diversity that have been used in the study of interstate and intrastate conflict during the past few decades.

Social Welfare And Equality

The main purpose of the paper is to provide a unified framework within which normatively significant equality indices can be derived from social welfare orderings. The paper contains a functional representation of the class of social evaluation functions generating relative equality indices.

A characterization of the core in overlapping-generations economies

Abstract In this paper we characterize the set of consumption allocations that belong to the core and show that for the case of one agent per generation and one good no monetary equilibrium is in the core. For economies with many goods we give bounds on the value of money transactions for competitive equilibria to belong to the core.

Competitive equilibria and the core of overlapping generations economies

I Introduction.- 1 The Viability of Fiat Money.- II The Overlapping Generations Model of an Exchange Economy.- II Dynamic Efficiency.- III Competitive Equilibria in a Barter, Overlapping Generations Economy.- IV Monetary Equilibria.- III The Core in Overlapping Generations Economies.- V A Characterization of the Core.- VI Competitive Equilibria and the Core. One agent per generation.- VII Competitive Equilibria and the Core. Many agents per generation.- References.

Costly transfer institutions and the core in an overlapping generations model

We examine an overlapping generations economy with no pre-existing intergenerational transfers and study the set of transfer institutions in the core of the economy, that is, institutions that would be admissible for the first generation to create and would not be rejected by any future generation. Institution-building is assumed to be costly. We allow the cost of creating a new institution to vary with the size of the transfer it institutes and show that all institutions in the core must cost as much to build as they transfer. In fact, the core set is nonempty if and only if the institution that supports the golden-rule transfer costs as much to create as it transfers. The core set is characterized for various cost functions. We conclude that costs associated with the creation of transfer institutions are essential to make intergenerational transfers socially viable, but they may induce the choice of institutions making suboptimal transfers.

Liberty, Equality and Religiosity

Presentado el 22 de mayo de 2014 en la Conference on Axioms, Results and Methods in Normative Economics, celebrada del 22 al 24 de mayo de 2014 en Granada (Espana). Presentado el 9 de junio de 2014 en el International Economic Association 17th World Congress, celebrado del 6 al 10 de juni de 2014 en el Dead Sea (Jordania). Presentado como conferencia en el Department of Economics, Universita di Bologna. Presentado como conferencia en el Departamento de Fundamentos de Analisis Economico de la Universidad de Alicante el 31 de octubre de 2014. Presentado como conferencia el 2 de diciembre de 2015 en el Economics & Political Science (EPS) Seminars de INSEAD, The Business School for the World.

Competitive Equilibria and the Core. Many agents per generation

Overlapping generations models have been recently analysed from a game theoretical point of view. Specifically, the core of economies with an overlapping generations structure has been studied by Hendricks et al. [36], Kovenock [43], and Chae [161. Related concepts such as bounded core and short-run core have been dealt with by Hendricks et al. [36] and Chae [16], Chae and Esteban [17]. In this Chapter we shall examine the relation between competitive equilibria and the core in overlapping generations economies with many agents per generation.

The Viability of Fiat Money

In this book we analyse overlapping generations economies from a game theoretical point of view. We are concerned with the social acceptability of consumption allocations in infinite horizon models of pure exchange economies with agents with finite lifetimes who behave cooperatively. Specifically, we study the core of such economies and its relation with competitive equilibria.