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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
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    References listed on IDEAS

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    Cited by:

    1. 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.
    2. 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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