IDEAS home Printed from https://ideas.repec.org/a/taf/oxdevs/v35y2007i2p197-217.html
   My bibliography  Save this article

What's Behind the Inequality We Measure? An Investigation Using Latin American Data

Author

Listed:
  • Miguel SzEkely
  • Marianne Hilgert

Abstract

The use of income distribution indicators in the economics literature has increased considerably in recent years. Using household surveys from 18 Latin American and Caribbean countries, this article seeks to explore what is behind the numbers, and what information they convey. We find that the way in which countries rank according to inequality measured in a conventional way is, to a large extent, an illusion created by differences in characteristics of the data and on the particular ways in which the data are treated. Our main conclusion is that there is an important story behind each number. This story influences our judgment about how unequal countries are, but it is seldom told or understood. Perhaps other statistics commonly used in economics also have their own interesting story, and it might be worth trying to find out what it is.

Suggested Citation

  • Miguel SzEkely & Marianne Hilgert, 2007. "What's Behind the Inequality We Measure? An Investigation Using Latin American Data," Oxford Development Studies, Taylor & Francis Journals, vol. 35(2), pages 197-217.
    • Handle: RePEc:taf:oxdevs:v:35:y:2007:i:2:p:197-217
    DOI: 10.1080/13600810701427626
    as

    Download full text from publisher

    File URL: http://www.tandfonline.com/doi/abs/10.1080/13600810701427626
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/13600810701427626?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Alesina, Alberto & Perotti, Roberto, 1996. "Income distribution, political instability, and investment," European Economic Review, Elsevier, vol. 40(6), pages 1203-1228, June.
    2. Martin Ravallion & Shaohua Chen, 1999. "When Economic Reform is Faster Then Statistical Reform: Measuring and Explaining Income Inequality in Rural China," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 61(1), pages 33-56, February.
    3. Deininger, Klaus & Squire, Lyn, 1996. "A New Data Set Measuring Income Inequality," The World Bank Economic Review, World Bank, vol. 10(3), pages 565-591, September.
    4. Gottschalk, Peter & Smeeding, Timothy M., 2000. "Empirical evidence on income inequality in industrialized countries," Handbook of Income Distribution, in: A.B. Atkinson & F. Bourguignon (ed.), Handbook of Income Distribution, edition 1, volume 1, chapter 5, pages 261-307, Elsevier.
    5. Deaton,Angus & Muellbauer,John, 1980. "Economics and Consumer Behavior," Cambridge Books, Cambridge University Press, number 9780521296762, September.
    6. Deininger, Klaus & Squire, Lyn, 1996. "A New Data Set Measuring Income Inequality," The World Bank Economic Review, World Bank, vol. 10(3), pages 565-591, September.
    7. Roberto Perotti, 1993. "Political Equilibrium, Income Distribution, and Growth," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 60(4), pages 755-776.
    8. Atkinson, A B, 1997. "Bringing Income Distribution in from the Cold," Economic Journal, Royal Economic Society, vol. 107(441), pages 297-321, March.
    9. Andrea Brandolini & Anthony B. Atkinson, 2001. "Promise and Pitfalls in the Use of "Secondary" Data-Sets: Income Inequality in OECD Countries As a Case Study," Journal of Economic Literature, American Economic Association, vol. 39(3), pages 771-799, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Alvaredo, Facundo & Bourguignon, François & Ferreira, Francisco H. G. & Lustig, Nora, 2023. "Seventy-five Years of Measuring Income Inequality in Latin America," IDB Publications (Working Papers) 13157, Inter-American Development Bank.
    2. Hai-Anh H. Dang & Peter F. Lanjouw, 2016. "Toward a New Definition of Shared Prosperity: A Dynamic Perspective from Three Countries," International Economic Association Series, in: Kaushik Basu & Joseph E. Stiglitz (ed.), Inequality and Growth: Patterns and Policy, chapter 5, pages 151-171, Palgrave Macmillan.
    3. Rodriguez Castelan,Carlos & Lopez-Calva,Luis-Felipe & Lustig,Nora & Valderrama,Daniel, 2016. "Understanding the dynamics of labor income inequality in Latin America," Policy Research Working Paper Series 7795, The World Bank.
    4. Carlos de la Espriella, 2009. "A Technique for Small-area Poverty Analyses," Urban Studies, Urban Studies Journal Limited, vol. 46(11), pages 2399-2421, October.
    5. Facundo Alvaredo & François Bourguignon & Francisco Ferreira & Nora Lustig, 2024. "Inequality bands: Seventy-five years of measuring income inequality in latin america," World Inequality Lab Working Papers halshs-04563817, HAL.
    6. Carlos Rodríguez‐Castelán & Luis Felipe López‐Calva & Nora Lustig & Daniel Valderrama, 2022. "Wage inequality in the developing world: Evidence from Latin America," Review of Development Economics, Wiley Blackwell, vol. 26(4), pages 1944-1970, November.
    7. Wannaphong Durongkaveroj, 2018. "Tolerance for inequality: Hirschman's tunnel effect revisited," Journal of International Development, John Wiley & Sons, Ltd., vol. 30(7), pages 1240-1247, October.
    8. Sámano, Claudia & Szekely, Miguel, 2012. "Did Trade Openness Affect Income Distribution in Latin America? Evidence for the Years 1980-2010," WIDER Working Paper Series 003, World Institute for Development Economic Research (UNU-WIDER).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Patrizio Pagano, 2004. "An empirical investigation of the relationship between inequality and growth," Temi di discussione (Economic working papers) 536, Bank of Italy, Economic Research and International Relations Area.
    2. Christophe Ehrhart, 2009. "The effects of inequality on growth: a survey of the theoretical and empirical literature," Working Papers 107, ECINEQ, Society for the Study of Economic Inequality.
    3. Hugo Rojas-Romagosa & J.F. Francois, 2008. "Reassessing the relationship between inequality and development," CPB Discussion Paper 107, CPB Netherlands Bureau for Economic Policy Analysis.
    4. Jakub Bartak & Łukasz Jabłoński, 2020. "Inequality and growth: What comes from the different inequality measures?," Bulletin of Economic Research, Wiley Blackwell, vol. 72(2), pages 185-212, April.
    5. Heshmati, Almas, 2004. "The World Distribution of Income and Income Inequality," IZA Discussion Papers 1267, Institute of Labor Economics (IZA).
    6. Dustin Chambers & Alan Krause, 2010. "Is the relationship between inequality and growth affected by physical and human capital accumulation?," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 8(2), pages 153-172, June.
    7. Bartak, Jakub & Jabłoński, Łukasz & Tomkiewicz, Jacek, 2022. "Does income inequality explain public debt change in OECD countries?," International Review of Economics & Finance, Elsevier, vol. 80(C), pages 211-224.
    8. Hugo Rojas-Romagosa & J.F. Francois, 2008. "Reassessing the relationship between inequality and development," CPB Discussion Paper 107.rdf, CPB Netherlands Bureau for Economic Policy Analysis.
    9. Claudia Biancotti, 2004. "A Polarization of Polarization? The Distribution of Inequality 1970-1996," Temi di discussione (Economic working papers) 487, Bank of Italy, Economic Research and International Relations Area.
    10. Shinhye Chang & Rangan Gupta & Stephen M. Miller, 2018. "Causality Between Per Capita Real GDP and Income Inequality in the U.S.: Evidence from a Wavelet Analysis," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 135(1), pages 269-289, January.
    11. Francois, Joseph & Rojas-Romagosa, Hugo, 2005. "The Construction and Interpretation of Combined Cross-Section and Time-Series Inequality Datasets," CEPR Discussion Papers 5214, C.E.P.R. Discussion Papers.
    12. Carola Grün & Stephan Klasen, 2003. "Growth, Income Distribution, and Well-Being: Comparisons across Space and Time," CESifo Working Paper Series 837, CESifo.
    13. Angus Deaton, 2003. "Health, Inequality, and Economic Development," Journal of Economic Literature, American Economic Association, vol. 41(1), pages 113-158, March.
    14. Adalgiso Amendola & Roberto Dell�Anno, 2014. "Income inequality and economic growth: an empirical investigation in Mediterranean countries," RIEDS - Rivista Italiana di Economia, Demografia e Statistica - The Italian Journal of Economic, Demographic and Statistical Studies, SIEDS Societa' Italiana di Economia Demografia e Statistica, vol. 68(2), pages 35-58, April-Jun.
    15. Kerr, William R., 2014. "Income inequality and social preferences for redistribution and compensation differentials," Journal of Monetary Economics, Elsevier, vol. 66(C), pages 62-78.
    16. Ozan Hatipoglu, 2012. "The relationship between inequality and innovative activity: a S chumpeterian theory and evidence from cross‐country data," Scottish Journal of Political Economy, Scottish Economic Society, vol. 59(2), pages 224-248, May.
    17. Ananya Ghosh Dastidar, 2004. "Structural Change and Income Distribution in Developing Economies: Evidence from a Group of Asian and Latin American Countries," Working papers 121, Centre for Development Economics, Delhi School of Economics.
    18. Nobuhiro Mizuno & Katsuyuki Naito & Ryosuke Okazawa, 2017. "Inequality, extractive institutions, and growth in nondemocratic regimes," Public Choice, Springer, vol. 170(1), pages 115-142, January.
    19. Filip Novokmet, 2018. "The long-run evolution of inequality in the Czech Lands, 1898-2015," PSE Working Papers hal-02878212, HAL.
    20. Hong-Ghi Min, 2002. "Inequality, the price of nontradables, and the real exchange rate : theory and cross-country evidence," Policy Research Working Paper Series 2758, The World Bank.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:oxdevs:v:35:y:2007:i:2:p:197-217. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/CODS20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.