Shocks and the dispersion of the well-being of different economic agents

OECD economies have been hit by a number of shocks since 2020: the COVID crisis, the effects of the end of the COVID crisis, the war in Ukraine and its impact s on commodity prices. Normally, the utility of the income (well-being) of a group of economic agents is the sum of the utilities of the income of each of these economic agents minus the dispersion of the incomes of these different economic agents. We apply this result to the utility of employees ’ and companies ’ incomes . We prefer a situation where corporate earnings and employee incomes move in parallel to one where they move very differently. We look at the situations of the United States, the euro zone, the United Kingdom and Japan between 2019 and 2023. We see: Similar growth in wages and earnings in the euro zone, which increases overall well-being; Different growth in wages and earnings in the United States, the United Kingdom and Japan, which reduces overall well-being.