Working Paper 2011-237
The paper provides the axiomatic characterization of a new relative deprivation index. The concept of relative deprivation is here extended towards the inter-temporal framework. In fact, if we agree that deprivation is a relative concept, we should also believe that individuals not only take care of their relative position with respect to others, but also of their relative position with respect to their own past. While in the traditional relative deprivation framework the reference group is only other-regarding, in our work we stretch this idea and we also introduce a history-regarding reference group. The new index is illustrated with an application to EU countries.
Authors: Lidia Ceriani, Chiara Gigliarano.