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The measurement of structural and exchange income mobility

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  • Javier Ruiz-Castillo

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Abstract

Chakravarty, Dutta and Weymark (1985) present operational axioms for an ethical index of income mobility that are best suited for a two period world. This paper suggests a decomposition of this index into two terms: (i) an index of structural or snapshot mobility, which captures the welfare effect of differences in the inequality of the cross-section income distributions; and (ii) an index of exchange or rerankings mobility, which captures the welfare impact of rank reversals between the first- and the second-period income distributions. Income inequality reductions and rank reversals are always welfare enhancing. The properties of all the income mobility concepts introduced in the paper do not require any new value judgements beyond the traditional ones. Copyright Kluwer Academic Publishers 2004

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File URL: http://hdl.handle.net/10.1007/s10888-004-4075-3
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Bibliographic Info

Article provided by Springer in its journal The Journal of Economic Inequality.

Volume (Year): 2 (2004)
Issue (Month): 3 (September)
Pages: 219-228

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Handle: RePEc:kap:jecinq:v:2:y:2004:i:3:p:219-228

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Web page: http://springerlink.metapress.com/link.asp?id=111137

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Keywords: distributional change; exchange and structural mobility; income mobility;

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  1. Markandya, Anil, 1982. "Intergenerational exchange mobility and economic welfare," European Economic Review, Elsevier, vol. 17(3), pages 307-324.
  2. Karcher, T. & Moyes, P. & Trannoy, Y., 1993. "The Stochastic Dominance Ordering of Income Distributions of Over Time. I," Papers 9304, Paris X - Nanterre, U.F.R. de Sc. Ec. Gest. Maths Infor..
  3. Fields, Gary S & Ok, Efe A, 1999. "Measuring Movement of Incomes," Economica, London School of Economics and Political Science, vol. 66(264), pages 455-71, November.
  4. repec:ese:iserwp:20 is not listed on IDEAS
  5. Shorrocks, A F, 1978. "The Measurement of Mobility," Econometrica, Econometric Society, vol. 46(5), pages 1013-24, September.
  6. Moulin, Herve, 1994. "Social choice," Handbook of Game Theory with Economic Applications, in: R.J. Aumann & S. Hart (ed.), Handbook of Game Theory with Economic Applications, edition 1, volume 2, chapter 31, pages 1091-1125 Elsevier.
  7. Berrebi, Z. M. & Silber, Jacques, 1983. "On an absolute measure of distributional change," European Economic Review, Elsevier, vol. 22(2), pages 139-146, July.
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