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Proposing indicators to measure achievement and shortfall inequality consistently

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  • Lasso de la Vega, Casilda
  • Aristondo, Oihana

Abstract

In several economic fields, such as those related to health or education, the individuals’ characteristics are measured by bounded variables. Accordingly, these characteristics may be indistinctly represented by achievements or shortfalls. A difficulty arises when inequality needs to be assessed. One may focus either on achievements or on shortfalls but the respective inequality rankings may lead to contradictory results. In this note we propose a procedure to define indicators that measure equally the achievement and shortfall inequality. Specifically, we derive measures which are invariant under ratio-scale or translation transformations, and a decomposable measure is also obtained. As the indicators proposed depend on the distribution bounds, families of indices that guarantee the same inequality rankings regardless of the distribution maximal levels are identified.

Suggested Citation

  • Lasso de la Vega, Casilda & Aristondo, Oihana, 2012. "Proposing indicators to measure achievement and shortfall inequality consistently," Journal of Health Economics, Elsevier, vol. 31(4), pages 578-583.
  • Handle: RePEc:eee:jhecon:v:31:y:2012:i:4:p:578-583
    DOI: 10.1016/j.jhealeco.2012.02.006
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    References listed on IDEAS

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    1. Shorrocks, A F, 1980. "The Class of Additively Decomposable Inequality Measures," Econometrica, Econometric Society, vol. 48(3), pages 613-625, April.
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    Citations

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    Cited by:

    1. Kjellsson, Gustav, 2014. "Extending Decomposition Analysis to Account for Socioeconomic Background: Income-Related Smoking Inequality among Swedish Women," Working Papers 2014:29, Lund University, Department of Economics.
    2. Kjellsson, Gustav & Gerdtham, Ulf-G., 2013. "On correcting the concentration index for binary variables," Journal of Health Economics, Elsevier, vol. 32(3), pages 659-670.
    3. Satya R. Chakravarty & Nachiketa Chattopadhyay & Conchita D'Ambrosio, 2016. "On a Family of Achievement and Shortfall Inequality Indices," Health Economics, John Wiley & Sons, Ltd., vol. 25(12), pages 1503-1513, December.
    4. Kjellsson, Gustav & Gerdtham, Ulf-G., 2013. "Lost in Translation: Rethinking the Inequality-Equivalence Criteria for Bounded Health Variables," Working Papers 2013:18, Lund University, Department of Economics, revised 02 Jan 2014.
    5. repec:bla:revinw:v:62:y:2016:i:4:p:758-774 is not listed on IDEAS
    6. Oihana Aristondo & Francisco J. Goerlich Gisbert & Casilda Lasso De La Vega, 2015. "A Proposal to Compare Consistently the Inequality Among the Poor," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 61(3), pages 561-572, September.
    7. Suman Seth & Gaston Yalonetzky, 2016. "Has the world converged? A robust analysis of non-monetary bounded indicators," Working Papers 398, ECINEQ, Society for the Study of Economic Inequality.
    8. Nanak Kakwani & Hyun H. Son, 2015. "Income inequality and social well-being," Working Papers 380, ECINEQ, Society for the Study of Economic Inequality.
    9. Kristof Bosmans, 2016. "Consistent Comparisons of Attainment and Shortfall Inequality: A Critical Examination," Health Economics, John Wiley & Sons, Ltd., vol. 25(11), pages 1425-1432, November.

    More about this item

    Keywords

    Inequality measurement; Health inequality; Achievements; Shortfalls;

    JEL classification:

    • I30 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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