IDEAS home Printed from https://ideas.repec.org/a/taf/applec/v32y2000i7p845-860.html
   My bibliography  Save this article

Are estimates of earnings inequality sensitive to measurement choices? A case study of Canada in the 1980s

Author

Listed:
  • Fiona MaCphail

Abstract

While it is necessary that researchers make choices in order to estimate inequality, the reasons for the measurement choices and their impact on inequality estimates have not been widely assessed. This paper uses Canadian data from the 1980s to analyse whether inequality estimates are sensitive to common measurement choices. Seemingly minor technical choices about the treatment of outlying observations, such as the use of top-income coded data, exclusion of very high and low observations, and differences among data sets in the capture of very high observations affect estimates of inequality. Further, the impact of the treatment of outlying observations on inequality estimates are at least as large as the impact of measurement choices of a conceptual nature, such as the income definition and population selection. The sensitivity of inequality estimates to measurement choices, which often remain invisible, affect inferences about the relative degree of inequality at a given point in time among countries and changes over time.

Suggested Citation

  • Fiona MaCphail, 2000. "Are estimates of earnings inequality sensitive to measurement choices? A case study of Canada in the 1980s," Applied Economics, Taylor & Francis Journals, vol. 32(7), pages 845-860.
    • Handle: RePEc:taf:applec:v:32:y:2000:i:7:p:845-860
    DOI: 10.1080/000368400322183
    as

    Download full text from publisher

    File URL: http://www.tandfonline.com/doi/abs/10.1080/000368400322183
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/000368400322183?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Johan Fritzell, 1992. "Income Inequality Trends in the 1980 s: A Five Country Comparison," LIS Working papers 73, LIS Cross-National Data Center in Luxembourg.
    2. Ogwang, Tomson, 2000. "A Convenient Method of Computing the Gini Index and Its Standard Error," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 62(1), pages 123-129, February.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Eric G. Moore & Michael A. Pacey, 2003. "Changing Income Inequality and Immigration in Canada, 1980­1995," Canadian Public Policy, University of Toronto Press, vol. 29(1), pages 33-51, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ogwang, Tomson, 2007. "Additional properties of a linear pen's parade for individual data using the stochastic approach to the Gini index," Economics Letters, Elsevier, vol. 96(3), pages 369-374, September.
    2. Xiaofeng Lv & Gupeng Zhang & Guangyu Ren, 2017. "Gini index estimation for lifetime data," Lifetime Data Analysis: An International Journal Devoted to Statistical Methods and Applications for Time-to-Event Data, Springer, vol. 23(2), pages 275-304, April.
    3. Davidson, Russell, 2009. "Reliable inference for the Gini index," Journal of Econometrics, Elsevier, vol. 150(1), pages 30-40, May.
    4. Karoly, Lynn & Schröder, Carsten, 2015. "Fast methods for jackknifing inequality indices," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 37(1), pages 125-138.
    5. Kuan Xu, 2007. "U-Statistics and Their Asymptotic Results for Some Inequality and Poverty Measures," Econometric Reviews, Taylor & Francis Journals, vol. 26(5), pages 567-577.
    6. David E. A. Giles, 2004. "Calculating a Standard Error for the Gini Coefficient: Some Further Results," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 66(3), pages 425-433, July.
    7. Lingsheng Meng & Binzhen Wu & Zhaoguo Zhan, 2016. "Linear regression with an estimated regressor: applications to aggregate indicators of economic development," Empirical Economics, Springer, vol. 50(2), pages 299-316, March.
    8. Xiaofeng Lv & Gupeng Zhang & Xinkuo Xu & Qinghai Li, 2017. "Bootstrap-calibrated empirical likelihood confidence intervals for the difference between two Gini indexes," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 15(2), pages 195-216, June.
    9. Clark, Ephraim & Jokung, Octave & Kassimatis, Konstantinos, 2011. "Making inefficient market indices efficient," European Journal of Operational Research, Elsevier, vol. 209(1), pages 83-93, February.
    10. Silvia Avram & Horacio Levy & Holly Sutherland, 2014. "Income redistribution in the European Union," IZA Journal of European Labor Studies, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 3(1), pages 1-29, December.
    11. Channing Arndt & Sam Jones & Vincenzo Salvucci, 2015. "When do relative prices matter for measuring income inequality? The case of food prices in Mozambique," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 13(3), pages 449-464, September.
    12. Heshmati, Almas, 2004. "A Review of Decomposition of Income Inequality," IZA Discussion Papers 1221, Institute of Labor Economics (IZA).
    13. Jes s Ruiz-Huerta & Luis Ayala & Rosa Martinez, 1999. "Earnings Inequality, Unemployment and Income Distribution in the OECD," LIS Working papers 214, LIS Cross-National Data Center in Luxembourg.
    14. Gerald W. Scully, 2004. "Player salary share and the distribution of player earnings," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 25(2), pages 77-86.
    15. Xiaofeng Lv & Gupeng Zhang & Xinkuo Xu & Qinghai Li, 2017. "Bootstrap-calibrated empirical likelihood confidence intervals for the difference between two Gini indexes," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 15(2), pages 195-216, June.
    16. Ilaria Benedetti & Federico Crescenzi & Tiziana Laureti, 2020. "Measuring Uncertainty for Poverty Indicators at Regional Level: The Case of Mediterranean Countries," Sustainability, MDPI, vol. 12(19), pages 1-19, October.
    17. Fiona Macphail, 1998. "Increased Earnings Inequality and Macroeconomic Performance: the case of Canada in the 1980s," International Review of Applied Economics, Taylor & Francis Journals, vol. 12(3), pages 333-359.
    18. Judith A. Clarke & Ahmed A. Hoque, 2014. "On Variance Estimation for a Gini Coefficient Estimator Obtained from Complex Survey Data," Econometrics Working Papers 1401, Department of Economics, University of Victoria.
    19. Ogwang Tomson, 2014. "A Convenient Method of Decomposing the Gini Index by Population Subgroups," Journal of Official Statistics, Sciendo, vol. 30(1), pages 91-105, March.
    20. Wang, Dongliang & Zhao, Yichuan & Gilmore, Dirk W., 2016. "Jackknife empirical likelihood confidence interval for the Gini index," Statistics & Probability Letters, Elsevier, vol. 110(C), pages 289-295.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:applec:v:32:y:2000:i:7:p:845-860. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/RAEC20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.