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Calculating concentration index with repetitive values of indicators of economic welfare

  • Chen, Zhuo
  • Roy, Kakoli

Repetitive values of the ranking indicators of economic welfare are often introduced due to incidental ties or censoring in the welfare variable, or the categorical nature of welfare variables used in numerous national surveys. In calculating concentration index (CI), assigning different fractional ranks to observations that have same values of the welfare measure leads to unstable and inconsistent CI estimates when the welfare variable is categorical or censored. In this paper, we establish an interval within which the CI estimates lie, and propose a solution, which is an extension of (Kakwani, N.C., Wagstaff, A., van Doorslaer, E., 1997. Socioeconomic inequalities in health: measurement, computation, and statistical inference. Journal of Econometrics 77, 87-103), for consistent and replicable estimates of CI when there are a substantial number of ties of the welfare indicator.

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Article provided by Elsevier in its journal Journal of Health Economics.

Volume (Year): 28 (2009)
Issue (Month): 1 (January)
Pages: 169-175

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Handle: RePEc:eee:jhecon:v:28:y:2009:i:1:p:169-175
Contact details of provider: Web page: http://www.elsevier.com/locate/inca/505560

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  1. van Doorslaer, Eddy & Wagstaff, Adam & Bleichrodt, Han & Calonge, Samuel & Gerdtham, Ulf-G. & Gerfin, Michael & Geurts, Jose & Gross, Lorna & Hakkinen, Unto & Leu, Robert E., 1997. "Income-related inequalities in health: some international comparisons," Journal of Health Economics, Elsevier, vol. 16(1), pages 93-112, February.
  2. Wagstaff, Adam & Paci, Pierella & van Doorslaer, Eddy, 1991. "On the measurement of inequalities in health," Social Science & Medicine, Elsevier, vol. 33(5), pages 545-557, January.
  3. Andrew M. Jones & Angel López, 2003. "Measurement and Explanation of Socioeconomic Inequality in Health with Longitudinal Data," Working Papers 35, Barcelona Graduate School of Economics.
  4. Gerdtham, U. -G. & Johannesson, M. & Lundberg, L. & Isacson, D., 1999. "A note on validating Wagstaff and van Doorslaer's health measure in the analysis of inequalities in health," Journal of Health Economics, Elsevier, vol. 18(1), pages 117-124, January.
  5. Tom Van Ourti, 2004. "Measuring horizontal inequity in Belgian health care using a Gaussian random effects two part count data model," Health Economics, John Wiley & Sons, Ltd., vol. 13(7), pages 705-724.
  6. Wagstaff, Adam & van Doorslaer, Eddy & Watanabe, Naoko, 2003. "On decomposing the causes of health sector inequalities with an application to malnutrition inequalities in Vietnam," Journal of Econometrics, Elsevier, vol. 112(1), pages 207-223, January.
  7. Chen, Zhuo & Eastwood, David B. & Yen, Steven T., 2007. "A decade's story of childhood malnutrition inequality in China: Where you live does matter," China Economic Review, Elsevier, vol. 18(2), pages 139-154.
  8. Xu, Ke Tom, 2006. "State-level variations in income-related inequality in health and health achievement in the US," Social Science & Medicine, Elsevier, vol. 63(2), pages 457-464, July.
  9. Doorslaer, Eddy van & Jones, Andrew M., 2003. "Inequalities in self-reported health: validation of a new approach to measurement," Journal of Health Economics, Elsevier, vol. 22(1), pages 61-87, January.
  10. Kakwani, Nanak & Wagstaff, Adam & van Doorslaer, Eddy, 1997. "Socioeconomic inequalities in health: Measurement, computation, and statistical inference," Journal of Econometrics, Elsevier, vol. 77(1), pages 87-103, March.
  11. Jens Gundgaard & Jørgen Lauridsen, 2006. "A decomposition of income-related health inequality applied to EQ-5D," The European Journal of Health Economics, Springer, vol. 7(4), pages 231-237, December.
  12. Eddy van Doorslaer & Cristina Masseria, 2004. "Income-Related Inequality in the Use of Medical Care in 21 OECD Countries," OECD Health Working Papers 14, OECD Publishing.
  13. Zhang, Qi & Wang, Youfa, 2004. "Socioeconomic inequality of obesity in the United States: do gender, age, and ethnicity matter?," Social Science & Medicine, Elsevier, vol. 58(6), pages 1171-1180, March.
  14. Adam Wagstaff, 2005. "The bounds of the concentration index when the variable of interest is binary, with an application to immunization inequality," Health Economics, John Wiley & Sons, Ltd., vol. 14(4), pages 429-432.
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