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A stochastic dominance approach to the measurement of discrimination

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  • 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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    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. Jenkins, Stephen P., 1994. "Earnings discrimination measurement : A distributional approach," Journal of Econometrics, Elsevier, vol. 61(1), pages 81-102, March.
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    5. Atkinson, Anthony B., 1970. "On the measurement of inequality," Journal of Economic Theory, Elsevier, vol. 2(3), pages 244-263, September.
    6. Foster, James E. & Shorrocks, Anthony F., 1988. "Inequality and poverty orderings," European Economic Review, Elsevier, vol. 32(2-3), pages 654-661, March.
    7. 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.
    8. Shorrocks, Anthony F, 1983. "Ranking Income Distributions," Economica, London School of Economics and Political Science, vol. 50(197), pages 3-17, February.
    9. Rothschild, Michael & Stiglitz, Joseph E., 1970. "Increasing risk: I. A definition," Journal of Economic Theory, Elsevier, vol. 2(3), pages 225-243, September.
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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 14-01, INRAE UMR SMART.
    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. Niels-Jakob Harbo Hansen & Karl Harmenberg & Erik Öberg & Hans Henrik Sievertsen, 2021. "Gender disparities in top earnings: measurement and facts for Denmark 1980-2013," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 19(2), pages 347-362, June.
    7. Philippe Van Kerm, 2013. "Generalized measures of wage differentials," Empirical Economics, Springer, vol. 45(1), pages 465-482, August.
    8. Carlos Gradín, 2020. "Segregation of women into low-paying occupations in the United States," Applied Economics, Taylor & Francis Journals, vol. 52(17), pages 1905-1920, April.
    9. 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 (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 6, pages 1-32.
    10. Francesco Andreoli & Claudio Zoli, 2012. "On the Measurement of Dissimilarity and Related Orders," Working Papers 274, ECINEQ, Society for the Study of Economic Inequality.
    11. Tugce Cuhadaroglu, 2023. "Evaluating ordinal inequalities between groups," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 21(1), pages 219-231, March.
    12. Rafael Salas & John A. Bishop & Lester A. Zeager, 2018. "Second‐Order Discrimination and Generalized Lorenz Dominance," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 64(3), pages 563-575, September.
    13. Carlos Gradín, 2016. "Poverty and ethnicity in Asian countries," Chapters, in: Jacques Silber & Guanghua Wan (ed.), The Asian ‘Poverty Miracle’, chapter 8, pages 253-320, Edward Elgar Publishing.
    14. Hoy, Michael & Huang, Rachel J., 2017. "Measuring discrimination using principles of stochastic dominance," Journal of Economic Theory, Elsevier, vol. 167(C), pages 39-52.
    15. Francesco Andreoli & Claudio Zoli, 2014. "Measuring Dissimilarity," Working Papers 23/2014, University of Verona, Department of Economics.
    16. Rolf Aaberge & Tarjei Havnes & Magne Mogstad, 2013. "A theory for ranking distribution functions," Discussion Papers 763, Statistics Norway, Research Department.
    17. Carlos Gradín, 2017. "Segregation of women into low-paying occupations in the US," Working Papers 426, ECINEQ, Society for the Study of Economic Inequality.
    18. Carmen Herrero & Antonio Villar, 2021. "Opportunity advantage between income distributions," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 19(4), pages 785-799, December.
    19. 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).
    20. 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).
    21. 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.
    22. Charles Beach, 2023. "Quantile Tool Box Measures for Empirical Analysis and for Testing Distributional Comparisons in Direct Distribution-Free Fashion," Working Paper 1508, Economics Department, Queen's University.

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    More about this item

    Keywords

    Discrimination measurement; Stochastic dominance; Gastwirth index;
    All these keywords.

    JEL classification:

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

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