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Poverty and inequality under income and price dispersions

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  • Christophe Muller

Abstract

We introduce an analytical framework for welfare analysis that accounts for changes in the joint distribution of prices and incomes by using parametric formulae of poverty and inequality measures. We propose statistical indicators for the levels, variabilities and a statistical link of price indices and nominal living standards, which are consistent with a bivariate lognormal model. Our analysis provides intuitive insight about the social welfare impact of economic shocks affecting levels, variabilities, and correlation of prices and incomes. The roles of price and income variabilities for poverty and inequality are exhibited, with the possibility of several variation regimes.

Suggested Citation

  • Christophe Muller, 2005. "Poverty and inequality under income and price dispersions," Canadian Journal of Economics, Canadian Economics Association, vol. 38(3), pages 979-998, August.
    • Handle: RePEc:cje:issued:v:38:y:2005:i:3:p:979-998
    DOI: 10.1111/j.0008-4085.2005.00312.x
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    Cited by:

    1. Christophe Muller, 2023. "Poverty measurement under income and price dispersion," Chapters, in: Jacques Silber (ed.), Research Handbook on Measuring Poverty and Deprivation, chapter 14, pages 151-160, Edward Elgar Publishing.
    2. Karel Tomšík & Luboš Smutka, 2013. "Selected aspects and specifics of the economic development in sub-Saharan Africa," Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, Mendel University Press, vol. 61(2), pages 517-528.
    3. Li, Qingxiao & Yang, Jinyang & Yang, Xiaoli & Mu, Endong, 2025. "Decompose food price disparities in China: Evidence from wholesale markets," Food Policy, Elsevier, vol. 131(C).
    4. Christophe Muller, 2005. "Poverty and inequality under income and price dispersions," Canadian Journal of Economics, Canadian Economics Association, vol. 38(3), pages 979-998, August.
    5. Mussa, Richard, 2015. "A joint analysis of correlates of poverty intensity, incidence, and gap with application to Malawi," MPRA Paper 65205, University Library of Munich, Germany.

    More about this item

    JEL classification:

    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution

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