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A stochastic dominance approach to the measurement of discrimination

Author

Listed:
  • Le Breton, Michel
  • Michelangeli, Alessandra
  • Peluso, Eugenio

Abstract

This note suggests a bridge between stochastic dominance (Rothschild and Stiglitz, 1970 [17], 1973 [18]), inequality measurement (Atkinson, 1970 [1]) and discrimination measurement (Gastwirth, 1975 [10]). Discrimination orderings are defined and illustrated through discrimination curves, in the same spirit as stochastic dominance analysis. The main result, which links the second order discrimination curve and the Gastwirth discrimination index, also generalizes the equivalence between Generalized Lorenz dominance and second order stochastic dominance.

Suggested Citation

  • Le Breton, Michel & Michelangeli, Alessandra & Peluso, Eugenio, 2012. "A stochastic dominance approach to the measurement of discrimination," Journal of Economic Theory, Elsevier, vol. 147(4), pages 1342-1350.
  • Handle: RePEc:eee:jetheo:v:147:y:2012:i:4:p:1342-1350
    DOI: 10.1016/j.jet.2011.05.003
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    References listed on IDEAS

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    1. Rothschild, Michael & Stiglitz, Joseph E., 1973. "Some further results on the measurement of inequality," Journal of Economic Theory, Elsevier, vol. 6(2), pages 188-204, April.
    2. Foster, James E. & Shorrocks, Anthony F., 1988. "Inequality and poverty orderings," European Economic Review, Elsevier, vol. 32(2-3), pages 654-661, March.
    3. Jenkins, Stephen P., 1994. "Earnings discrimination measurement : A distributional approach," Journal of Econometrics, Elsevier, vol. 61(1), pages 81-102, March.
    4. Dasgupta, Partha & Sen, Amartya & Starrett, David, 1973. "Notes on the measurement of inequality," Journal of Economic Theory, Elsevier, vol. 6(2), pages 180-187, April.
    5. Gastwirth, Joseph L, 1971. "A General Definition of the Lorenz Curve," Econometrica, Econometric Society, vol. 39(6), pages 1037-1039, November.
    6. Shorrocks, Anthony F, 1983. "Ranking Income Distributions," Economica, London School of Economics and Political Science, vol. 50(197), pages 3-17, February.
    7. Foster, James E & Shorrocks, Anthony F, 1988. "Poverty Orderings," Econometrica, Econometric Society, vol. 56(1), pages 173-177, January.
    8. Rothschild, Michael & Stiglitz, Joseph E., 1970. "Increasing risk: I. A definition," Journal of Economic Theory, Elsevier, vol. 2(3), pages 225-243, September.
    9. Atkinson, Anthony B., 1970. "On the measurement of inequality," Journal of Economic Theory, Elsevier, vol. 2(3), pages 244-263, September.
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    Citations

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    Cited by:

    1. Allanson, Paul, 2014. "Income stratification and the measurement of interdistributional inequality between multiple groups," SIRE Discussion Papers 2015-34, Scottish Institute for Research in Economics (SIRE).
    2. Christoph Heinzel, 2014. "Term structure of discount rates under multivariate s-ordered consumption growth," Working Papers SMART - LERECO 14-01, INRA UMR SMART-LERECO.
    3. Monojit Chatterji & Sushil Mohan & Sayantan Ghosh Dastidar, 2015. "Determinants of public education expenditure: evidence from Indian states," International Journal of Education Economics and Development, Inderscience Enterprises Ltd, vol. 6(1), pages 1-19.
    4. John A. Bishop & Jonathan M. Lee & Lester A. Zeager, 2014. "The Great Recession and U.S. partial discrimination orderings by race," Economics and Business Letters, Oviedo University Press, vol. 3(3), pages 146-155.
    5. Gajdos, Thibault & Weymark, John A., 2012. "Introduction to inequality and risk," Journal of Economic Theory, Elsevier, vol. 147(4), pages 1313-1330.
    6. Philippe Van Kerm, 2013. "Generalized measures of wage differentials," Empirical Economics, Springer, vol. 45(1), pages 465-482, August.
    7. Yalonetzky, Gaston, 2012. "Measuring group disadvantage with inter-distributional inequality indices: A critical review and some amendments to existing indices," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy (IfW), vol. 6, pages 1-32.
    8. Francesco Andreoli & Claudio Zoli, 2012. "On the Measurement of Dissimilarity and Related Orders," Working Papers 274, ECINEQ, Society for the Study of Economic Inequality.
    9. Carlos Gradín, 2016. "Poverty and ethnicity in Asian countries," Chapters,in: The Asian ‘Poverty Miracle’, chapter 8, pages 253-320 Edward Elgar Publishing.
    10. Hoy, Michael & Huang, Rachel J., 2017. "Measuring discrimination using principles of stochastic dominance," Journal of Economic Theory, Elsevier, vol. 167(C), pages 39-52.
    11. Francesco Andreoli & Claudio Zoli, 2014. "Measuring Dissimilarity," Working Papers 23/2014, University of Verona, Department of Economics.
    12. Rolf Aaberge & Tarjei Havnes & Magne Mogstad, 2013. "A theory for ranking distribution functions," Discussion Papers 763, Statistics Norway, Research Department.
    13. Carlos Gradín, 2017. "Segregation of women into low-paying occupations in the US," Working Papers 426, ECINEQ, Society for the Study of Economic Inequality.
    14. Allanson, Paul, 2014. "Income stratification and the measurement of interdistributional inequality between multiple groups," 2007 Annual Meeting, July 29-August 1, 2007, Portland, Oregon TN 2015-34, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    15. Carlos Gradín, 2017. "Segregation of women into low-paying occupations in the United States," WIDER Working Paper Series 089, World Institute for Development Economic Research (UNU-WIDER).
    16. Peter Lambert & S. Subramanian, 2014. "Disparities in socio-economic outcomes: some positive propositions and their normative implications," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 43(3), pages 565-576, October.

    More about this item

    Keywords

    Discrimination measurement; Stochastic dominance; Gastwirth index;

    JEL classification:

    • D30 - Microeconomics - - Distribution - - - General
    • J70 - Labor and Demographic Economics - - Labor Discrimination - - - General

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