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Measuring Inequality of Well-Being with a Correlation-Sensitive Multidimensional Gini Index

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Koen Decancq
Maria Ana Lugo

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Abstract

We propose to measure inequality of well-being with a multidimensional generalization of the Gini coefficient. We derive two inequality indices from their underlying social evaluation functions. These functions are conceived as a double aggregation functions: one across the dimensions of well-being, and another across the individuals. They differ only with respect to the sequencing of aggregations. We argue that the sequencing that does not exclude the Gini index to be sensitive to the correlation between the dimensions is more attractive. We illustrate both Gini indices using Russian household data on three dimensions of well-being: expenditure, health and education.

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Paper provided by University of Oxford, Department of Economics in its series Economics Series Working Papers with number 459.

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Date of creation: 2009
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Handle: RePEc:oxf:wpaper:459

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Related research
Keywords: Multidimensional inequality; Single parameter Gini Index; Correlation increasing majorization; Russia;

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Find related papers by JEL classification:
D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
I31 - Health, Education, and Welfare - - Welfare and Poverty - - - General Welfare
O52 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - Europe

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