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Consumption inequality in Canada, 1997 to 2009

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  • Sam Norris
  • Krishna Pendakur

Abstract

We assess the evolution of consumption inequality in Canada over the years 1997 to 2009. We correct the imputation of shelter consumption for homeowners to allow for unobserved differences in housing quality correlated with selection into rental tenure, and we account for measurement error in this imputation. Using the annual Survey of Household Spending for years 1997 to 2009, we find that household-level consumption inequality measured by the Gini coefficient increased from 0.251 to 0.275 over 1997 to 2006. Between 2006 and 2007, consumption inequality may have decreased, and over 2007 to 2009, consumption inequality was flat. Over the entire period of 1997 to 2009, consumption inequality increased moderately. The Gini coefficient for individual-level consumption inequality followed a similar pattern, though the changes were smaller in magnitude. We also explore a possible correction for tail non-response bias in inequality measurement and find that the increase in measured consumption inequality is robust to this correction.

Suggested Citation

  • Sam Norris & Krishna Pendakur, 2015. "Consumption inequality in Canada, 1997 to 2009," Canadian Journal of Economics, Canadian Economics Association, vol. 48(2), pages 773-792, May.
    • Handle: RePEc:cje:issued:v:48:y:2015:i:2:p:773-792
    DOI: 10.1111/caje.12143
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    Cited by:

    1. He, Yuan & Li, Ke & Wang, Yipan, 2022. "Crossing the digital divide: The impact of the digital economy on elderly individuals’ consumption upgrade in China," Technology in Society, Elsevier, vol. 71(C).
    2. Xia, Qingjie & Li, Shi & Song, Lina, 2017. "Urban Consumption Inequality in China, 1995–2013," IZA Discussion Papers 11150, Institute of Labor Economics (IZA).
    3. Bharatee Bhusana Dash & Stanley L. Winer, 2025. "Inequality, Social Mobility and Convergence: Patterns Across the Indian States," CESifo Working Paper Series 12014, CESifo.
    4. Meng, Fan & Nie, Peng & Sousa-Poza, Alfonso, 2023. "Obesity inequality and well-being in Germany," Economics & Human Biology, Elsevier, vol. 49(C).
    5. Krishna Pendakur, 2018. "Welfare analysis when people are different," Canadian Journal of Economics, Canadian Economics Association, vol. 51(2), pages 321-360, May.
    6. Chen, Shuyang & Wang, Can, 2023. "Inequality impacts of ETS penalties: A case study on the recent Chinese nationwide ETS market," Energy Policy, Elsevier, vol. 173(C).
    7. James MacGee & Thomas Michael Pugh & Kurt See, 2022. "The heterogeneous effects of COVID‐19 on Canadian household consumption, debt and savings," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 55(S1), pages 54-87, February.
    8. Yu, Jian & Shi, Xunpeng & Cheong, Tsun Se, 2021. "Distribution dynamics of China's household consumption upgrading," Structural Change and Economic Dynamics, Elsevier, vol. 58(C), pages 193-203.
    9. Charles M. Beach, 2016. "Changing income inequality: A distributional paradigm for Canada," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 49(4), pages 1229-1292, November.

    More about this item

    JEL classification:

    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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