The Normative Analysis of 'Tagging' Revisited: Dealing with Stigmatization

Institut de Recherches Economiques et Sociales Working Paper No. 2003-30

29 Pages Posted: 25 Apr 2005 Last revised: 10 Apr 2015

See all articles by Laurence Jacquet

Laurence Jacquet

Catholic University of Louvain - Economic & Social Research Institute (IRES)

Bruno Van der Linden

Université Catholique de Louvain - Institut de Recherches Economiques et Sociales; IZA Institute of Labor Economics

Date Written: December 1, 2004

Abstract

Should income transfers be conditional upon personal characteristics of the potential recipients (the so-called "tagging") or should they only be tied to reported incomes? There is clear evidence that tagging and its assessment of the eligibility of applicants creates stigmatization. In this context, tagging is always suboptimal under a Maximin criterion. With a utilitarian criterion, tagging can only be recommended if the distribution of the intensity of stigmatization relative to earnings has small mean and variance and if the mean and variance of distribution of abilities among the high-ability people are neither too large nor too small.

Keywords: Tagging, optimal taxation, welfare programs, stigmatization

JEL Classification: H2, I3

Suggested Citation

Jacquet, Laurence and Van der Linden, Bruno, The Normative Analysis of 'Tagging' Revisited: Dealing with Stigmatization (December 1, 2004). Institut de Recherches Economiques et Sociales Working Paper No. 2003-30. Available at SSRN: https://ssrn.com/abstract=706826 or http://dx.doi.org/10.2139/ssrn.706826

Laurence Jacquet (Contact Author)

Catholic University of Louvain - Economic & Social Research Institute (IRES) ( email )

B-1348 Louvain-la-Neuve
Belgium

Bruno Van der Linden

Université Catholique de Louvain - Institut de Recherches Economiques et Sociales ( email )

3, Place Montesquieu
Louvain-la-Neuve, 1348
Belgium

HOME PAGE: http://perso.uclouvain.be/bruno.vanderlinden/

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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