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Illustrating Income Mobility: Two New Measures

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  • Creedy, John
  • Gemmell, Norman

Abstract

Jenkins and Lambert (1997) demonstrated that a number of measures of poverty could be combined and compared using the "Three Is of Poverty" (TIP) curve; the ‘three Is’ being the incidence, intensity and inequality of poverty. This paper takes the insights from the TIP curve and applies them to income growth based measures of mobility, proposing a "Three Is of Mobility", or TIM, curve. Similar analysis is then applied to re-ranking measures of mobility to yield a re-ranking ratio (RRR) curve. Illustrations are provided using income data from random samples of New Zealand income taxpayers over the period 1998 to 2010. It is argued that both curves represent simple graphical devices that nevertheless conveniently illustrate the "Three Is" properties of income mobility.

Suggested Citation

  • Creedy, John & Gemmell, Norman, 2017. "Illustrating Income Mobility: Two New Measures," Working Paper Series 20282, Victoria University of Wellington, Chair in Public Finance.
    • Handle: RePEc:vuw:vuwcpf:20282
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    References listed on IDEAS

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    1. Stephen P. Jenkins & Philippe Van Kerm, 2006. "Trends in income inequality, pro-poor income growth, and income mobility," Oxford Economic Papers, Oxford University Press, vol. 58(3), pages 531-548, July.
    2. Flaviana Palmisano & Dirk Van de gaer, 2016. "History-dependent growth incidence: a characterization and an application to the economic crisis in Italy," Oxford Economic Papers, Oxford University Press, vol. 68(2), pages 585-603.
    3. Stephen P. Jenkins & Philippe Van Kerm, 2016. "Assessing Individual Income Growth," Economica, London School of Economics and Political Science, vol. 83(332), pages 679-703, October.
    4. François Bourguignon, 2011. "Non-anonymous growth incidence curves, income mobility and social welfare dominance," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 9(4), pages 605-627, December.
    5. Van Kerm, Philippe & P. Jenkins, Stephen, 2011. "Trends in individual income growth: measurement methods and British evidence," ISER Working Paper Series 2011-06, Institute for Social and Economic Research.
    6. Ravallion, Martin & Chen, Shaohua, 2003. "Measuring pro-poor growth," Economics Letters, Elsevier, vol. 78(1), pages 93-99, January.
    7. A. B. Atkinson & F. Bourguignon, 1982. "The Comparison of Multi-Dimensioned Distributions of Economic Status," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 49(2), pages 183-201.
    8. Michael Grimm, 2007. "Removing the anonymity axiom in assessing pro-poor growth," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 5(2), pages 179-197, August.
    9. Trede, Mark, 1998. "Making mobility visible: a graphical device," Economics Letters, Elsevier, vol. 59(1), pages 77-82, April.
    10. Essama-Nssah B. & Lambert, Peter J., 2006. "Measuring the pro-poorness of income growth within an elasticity framework," Policy Research Working Paper Series 4035, The World Bank.
    11. Jenkins, Stephen P & Lambert, Peter J, 1997. "Three 'I's of Poverty Curves, with an Analysis of UK Poverty Trends," Oxford Economic Papers, Oxford University Press, vol. 49(3), pages 317-327, July.
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    Cited by:

    1. Creedy, John & Gemmell, Norman, 2018. "Income Inequality in New Zealand: Why Conventional Estimates are Misleading," Working Paper Series 7629, Victoria University of Wellington, Chair in Public Finance.
    2. John Creedy & Norman Gemmell, 2018. "Income Dynamics, Pro‐Poor Mobility and Poverty Persistence Curves," The Economic Record, The Economic Society of Australia, vol. 94(306), pages 316-328, September.
    3. John Creedy & Norman Gemmell, 2018. "Income Dynamics, Pro‐Poor Mobility and Poverty Persistence Curves," The Economic Record, The Economic Society of Australia, vol. 94(306), pages 316-328, September.

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