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Divergent Inequalities - Theory and Empirical Results (Revised Edition)

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  • Wolfson, Michael
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    Abstract

    Widely used summary measures of inequality or the "disappearing middle class" are potentially misleading. Divergences between evidence cited and conclusions drawn include failing to distinguish the concepts of inequality and polarization, and using scalar oinequalityo measures which are not consistent with rankings based on Lorenz curves. In addition, inappropriate claims about trends in inequality can arise from focusing on only a sub-population such as full-time male workers, and failing to account for sampling variability. These divergences are illustrated using Canadian data on labour incomes over the 1967 to 1994 period.

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    Bibliographic Info

    Paper provided by Statistics Canada, Analytical Studies Branch in its series Analytical Studies Branch Research Paper Series with number 1997066e.

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    Date of creation: 30 Jul 1997
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    Handle: RePEc:stc:stcp3e:1997066e

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    Keywords: Income; pensions; spending and wealth; Labour; Low income and inequality; Wages; salaries and other earnings;

    References

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    1. Steven J. Davis, 1992. "Cross-Country Patterns of Change in Relative Wages," NBER Working Papers 4085, National Bureau of Economic Research, Inc.
    2. John A. Bishop & John P. Formby & W. James Smith, 1993. "International Comparisons of Welfare and Poverty: Dominance Orderings for Ten Countries," Canadian Journal of Economics, Canadian Economics Association, vol. 26(3), pages 707-26, August.
    3. Levy, Frank & Murnane, Richard J, 1992. "U.S. Earnings Levels and Earnings Inequality: A Review of Recent Trends and Proposed Explanations," Journal of Economic Literature, American Economic Association, vol. 30(3), pages 1333-81, September.
    4. James Foster & Michael Wolfson, 2010. "Polarization and the decline of the middle class: Canada and the U.S," Journal of Economic Inequality, Springer, vol. 8(2), pages 247-273, June.
    5. Wolfson, Michael C, 1994. "When Inequalities Diverge," American Economic Review, American Economic Association, vol. 84(2), pages 353-58, May.
    6. Beach, C.M., 1988. "The "Vanishing" Middle Class?: Evidence and Explanations," Papers 1988-5, Queen's at Kingston - Sch. of Indus. Relat. Papers in Industrial Relations.
    7. repec:ese:iserwp:96-08 is not listed on IDEAS
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    Cited by:
    1. Costantini, Valeria & Monni, Salvatore, 2009. "Gender disparities in the Italian regions from a human development perspective," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 38(2), pages 256-269, March.
    2. Ravallion, Martin, 2009. "The Developing World's Bulging (but Vulnerable) "Middle Class"," Policy Research Working Paper Series 4816, The World Bank.
    3. Satya Chakravarty & Bhargav Maharaj, 2012. "Ethnic polarization orderings and indices," Journal of Economic Interaction and Coordination, Springer, vol. 7(1), pages 99-123, May.
    4. Satya Chakravarty & Bhargav Maharaj, 2011. "Measuring ethnic polarization," Social Choice and Welfare, Springer, vol. 37(3), pages 431-452, September.
    5. Thomas Kemeny & Michael Storper, 2012. "Specialization and Regional Economic Development," SERC Discussion Papers 0121, Spatial Economics Research Centre, LSE.
    6. Iñaki Permanyer, 2012. "The conceptualization and measurement of social polarization," Journal of Economic Inequality, Springer, vol. 10(1), pages 45-74, March.
    7. Janoes, A; & Rice, N; & Robone, S; & Rosa Dias, P;, 2010. "Inequality and Polarisation in Health Systems’ Responsiveness: A Cross-Country Analysis," Health, Econometrics and Data Group (HEDG) Working Papers 10/27, HEDG, c/o Department of Economics, University of York.
    8. Chiara GIGLIARANO & Karl MOSLER, 2009. "Measuring middle-class decline in one and many attributes," Working Papers 333, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.
    9. Fedorov, Leonid, 2002. "Regional Inequality and Regional Polarization in Russia, 1990-99," World Development, Elsevier, vol. 30(3), pages 443-456, March.
    10. Seshanna, Shubhasree & Decornez, Stephane, 2003. "Income polarization and inequality across countries: an empirical study," Journal of Policy Modeling, Elsevier, vol. 25(4), pages 335-358, June.
    11. Juan Prieto-Rodríguez & Rafael Salas & Juan Gabriel Rodríguez, 2003. "Polarization Characterization Of Inequality-Neutral Tax Reforms," Economics Bulletin, AccessEcon, vol. 4(19), pages 1-7.
    12. Antoine Parent & Damien Echevin, 2002. "Les indicateurs de polarisation et leur application à la France," Économie et Prévision, Programme National Persée, vol. 155(4), pages 13-30.
    13. Juan Prieto-Rodríguez & Juan Gabriel Rodríguez & Rafael Salas, . "Interactions Inequality-Polarization: Characterization Results(*)," Working Papers 15-05 Classification-JEL , Instituto de Estudios Fiscales.

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