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Volume 9, Issue 1

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Participation and Solidarity in Redistribution Mechanisms

Giménez-Gómez, José-Manuel; Peris, Josep E.

Year: 2015   Volume: 9   Issue: 1   Pages: 36-48

Abstract: Following Bossert (1995), we consider a model where personal income depends on two different characteristics: skills and effort. Luttens (2010) introduces claims that individuals have over aggregate income and that only depend on the effort they exert. Moreover, he proposes redistribution mechanisms in which solidarity is based on changes in a lower bound on what every individual deserves according to these claims: the so-called minimal rights (O’Neill 1982). A debatable consequence in one of Luttens’ mechanisms is that “the poorest individuals might up with a negative income” (Luttens 2010); that is, this mechanism does not satisfy participation, which turns out to be incompatible with claims feasibility, under Luttens’ assumptions. We present a new solidarity axiom that is compatible both with participation and claims feasibility, and we provide a mechanism satisfying these properties and our new additive solidarity axiom. Moreover, our mechanism satisfies additional properties, as priority, or respect of minimal rights.

JEL classification: C71, D63, D71

Keywords: Redistribution mechanism, minimal rights, solidarity, participation, claims feasibility

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