Alternative Distributions for Inequality and Poverty Comparisons
AbstractThis paper provides an introductory review of the alternative possible income distributions which can be used when making cross-sectional evaluations of the effects of taxes and transfers using a household economic survey. This paper attempts to clarify the various alternatives, both for users of data and those wishing to interpret results. Special attention is given to the choice of income unit. The need to avoid spurious comparisons is stressed. The use of adult equivalence scales and the application of an explicit sharing rule are considered. Comparisons over time, where both the tax structure and the populations differ, are also considered. Numerical examples are used to highlight the alternative approaches and distributions.
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Bibliographic InfoPaper provided by New Zealand Treasury in its series Treasury Working Paper Series with number 13/11.
Date of creation: Jul 2013
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Income distribution; adult equivalence scales; income unit;
Other versions of this item:
- Creedy, John, 2013. "Alternative Distributions for Inequality and Poverty Comparisons," Working Paper Series 2851, Victoria University of Wellington, Chair in Public Finance.
- D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
- D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
- D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
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