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Using the Dagum model to explain changes in personal income distribution

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  • Carmelo Garcia Perez
  • Mercedes Prieto Alaiz

Abstract

This article studies the evolution of personal income distribution in Spain from 1995 to 2005 using the Dagum model. Dagum's three parameter model (type I) provides a good fitting to empirical income distributions in Spain. Moreover, its parameters can be interpreted as economic indicators of income distribution changes. After studying the economic interpretation of the Dagum model parameters, we analyse the impact of parameter changes on different income percentiles and also on the evolution of inequality in Spain using data from the European Community Household Panel (ECHP) and the European Union Statistics on Income and Living Conditions (EU-SILC).

Suggested Citation

  • Carmelo Garcia Perez & Mercedes Prieto Alaiz, 2011. "Using the Dagum model to explain changes in personal income distribution," Applied Economics, Taylor & Francis Journals, vol. 43(28), pages 4377-4386.
  • Handle: RePEc:taf:applec:v:43:y:2011:i:28:p:4377-4386
    DOI: 10.1080/00036846.2010.491459
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    References listed on IDEAS

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    1. Mercedes Prieto Alaiz & Maria-Pia Victoria-Feser, 1996. "Modelling Income Distribution in Spain: A Robust Parametric Approach," STICERD - Distributional Analysis Research Programme Papers 20, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE.
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    1. repec:eee:phsmap:v:511:y:2018:i:c:p:104-126 is not listed on IDEAS
    2. Fernández-Morales, Antonio, 2016. "Measuring poverty with the Foster, Greer and Thorbecke indexes based on the Gamma distribution," MPRA Paper 69648, University Library of Munich, Germany.

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