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Unit Consistency And Bipolarization Of Income Distributions

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  • M-super-a Casilda Lasso de la Vega
  • Ana Urrutia
  • Henar Díez

Abstract

Many polarization measures proposed in the literature assume some invariance condition. Clearly, each invariance condition imposes a specific value judgment on polarization measurement. In inequality and poverty measurement, B. Zheng suggests rejecting these invariance conditions as axioms, and proposes replacing them with the unit-consistency axiom. This property demands that the inequality or poverty rankings, rather than their cardinal values, are not altered when income is measured in different monetary units. Following Zheng's proposal we explore the consequences of the unit-consistency axiom in the bipolarization field. We introduce a new family of Krtscha-type intermediate bipolarization indices, and also propose and characterize a class of intermediate polarization orderings which are unit-consistent. Finally, a short empirical application using data from Spain is also provided to illustrate how the bipolarization orderings proposed may be used in practice. Copyright 2009 The Authors. Journal compilation International Association for Research in Income and Wealth 2009.

Suggested Citation

  • M-super-a Casilda Lasso de la Vega & Ana Urrutia & Henar Díez, 2010. "Unit Consistency And Bipolarization Of Income Distributions," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 56(1), pages 65-83, March.
  • Handle: RePEc:bla:revinw:v:56:y:2010:i:1:p:65-83
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    Cited by:

    1. repec:eme:reinzz:s1049-258520170000025003 is not listed on IDEAS
    2. Fabio Clementi & Francesco Schettino, 2013. "Income polarization in Brazil, 2001-2011: A distributional analysis using PNAD data," Economics Bulletin, AccessEcon, vol. 33(3), pages 1796-1815.
    3. repec:bla:revinw:v:63:y:2017:i:4:p:608-632 is not listed on IDEAS
    4. Gaston Yalonetzky, 2013. "Relative bipolarization quasi-ordering based on Between-Group Gini (BGG) curves," Working Papers 318, ECINEQ, Society for the Study of Economic Inequality.
    5. Gaston Yalonetzky, 2014. "Relative bipolarization Lorenz curve," Economics Bulletin, AccessEcon, vol. 34(2), pages 1103-1113.
    6. Gaston Yalonetzky, 2017. "The Necessary Requirement of Median Independence for Relative Bipolarisation Measurement," Research on Economic Inequality,in: Research on Economic Inequality, volume 25, pages 51-62 Emerald Publishing Ltd.
    7. Gaston Yalonetzky, 2017. "The Benchmark of Maximum Relative Bipolarisation," Research on Economic Inequality,in: Research on Economic Inequality, volume 25, pages 39-50 Emerald Publishing Ltd.
    8. Satya Chakravarty & Bhargav Maharaj, 2012. "Ethnic polarization orderings and indices," Journal of Economic Interaction and Coordination, Springer;Society for Economic Science with Heterogeneous Interacting Agents, vol. 7(1), pages 99-123, May.
    9. Marek Kosny & Gaston Yalonetzky, 2016. "Relative p-bipolarisation measurement with generalised means and hybrid Lorenz curves," Working Papers 404, ECINEQ, Society for the Study of Economic Inequality.
    10. Mauro Mussini & Biancamaria Zavanella, 2015. "Measuring bipolarization in labour productivity in Italy: a new index and its decomposition by sectors and regional factors," RIVISTA DI ECONOMIA E STATISTICA DEL TERRITORIO, FrancoAngeli Editore, vol. 2015(3), pages 29-55.

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    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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