Linear Inequality Measures and the Redistribution of Income
AbstractA class of inequality measures that is a natural companion to the popular Lorenz curve is the class of measures that are linear in incomes. These measures, which include the Gini and S-Gini coefficients, can be interpreted as ethical means of relative deprivation feelings. Their change through the tax and benefit system can be decomposed simply as a sum of progressivity indices for individual taxes and benefits, minus an index of horizontal inequity measured by the extent of reranking in the population. These progressivity and horizontal inequity indices can also be interpreted as ethical means of perceptions of fiscal harshness and ill-performance. We furthermore derive the asymptotic sampling distribution of these classes of indices of redistribution, progressivity, and horizontal inequity, which enables their use with micro-data on a population. We illustrate the theoretical and statistical results through an application on the distribution and redistribution of income in Canada in 1981 and in 1990.
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Bibliographic InfoPaper provided by Université Laval - Département d'économique in its series Cahiers de recherche with number 9613.
Date of creation: 1996
Date of revision:
Other versions of this item:
- Duclos, J.Y. & Tabi, M., 1996. "Linear Inequality Measures and the Redistribution of Income," Papers 9613, Laval - Recherche en Politique Economique.
- D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
- D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
- H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
- I38 - Health, Education, and Welfare - - Welfare and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
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