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Polarization, growth and social policy in the case of Israel, 1997-2008

  • García-Fernández, Rosa María
  • Gottlieb, Daniel
  • Palacios-González, Frederico

In this paper we study income polarization by first comparing the efficiency of two statistical models to identify the number of poles in the income distribution empirically. The statistical models used are a multi-resolution analysis (MRA) and a log-normal approach (LNA). We then apply the methodology to Israeli income data over the years 1997-2008 in order to empirically detect the number of income classes as sub-populations of incomes concentrated around an optimally determined number of poles. After that we compute polarization using a multiplicative normalized polarization measure, developed by Palacios-González and García-Fernández (An Intra-Group Variance Based Polarization Measure, 2010), which consists of three interacting components based on well-known axioms of Esteban and Ray (Extensions of a Measure of Polarization OCDE Countries, 1994). Finally we study the causes of the obtained polarization results in a multinomial logit analysis.

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File URL: http://dx.doi.org/10.5018/economics-ejournal.ja.2013-15
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File URL: https://econstor.eu/bitstream/10419/73463/1/742432130.pdf
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Article provided by Kiel Institute for the World Economy (IfW) in its journal Economics: The Open-Access, Open-Assessment E-Journal.

Volume (Year): 7 (2013)
Issue (Month): ()
Pages: 1-40

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Handle: RePEc:zbw:ifweej:201315
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  1. X. Zhang & R. Kanbur, 2001. "What Difference Do Polarisation Measures Make? An Application to China," Journal of Development Studies, Taylor & Francis Journals, vol. 37(3), pages 85-98.
  2. Gottlieb, Daniel & Kushnir, Leonid, 2009. "Social policy targeting and binary information transfer between surveys," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy (IfW), vol. 3, pages 1-16.
  3. Duangkamon Chotikapanich & William E Griffiths, 2008. "Estimating Income Distributions Using a Mixture of Gamma Densities," Department of Economics - Working Papers Series 1034, The University of Melbourne.
  4. Seshanna, Shubhasree & Decornez, Stephane, 2003. "Income polarization and inequality across countries: an empirical study," Journal of Policy Modeling, Elsevier, vol. 25(4), pages 335-358, June.
  5. Gottlieb, Daniel, 2000. "Globalization and World financial Turmoil - A Test for Israel's Economic Policy," MPRA Paper 3150, University Library of Munich, Germany.
  6. Gottlieb, Daniel, 2002. "The Effect of Migrant Workers on Employment,Real Wages and Inequality The Case of Israel -1995 to 2000," MPRA Paper 3148, University Library of Munich, Germany.
  7. Maria Grazia Pittau & Roberto Zelli, 2006. "Trends in Income Distribution in Italy: A Non-Parametric 90 and a Semi-Parametric Analysis," Journal of Income Distribution, Journal of Income Distribution, vol. 15(I), pages 90-118, December.
  8. Jenkins, Stephen P., 1995. "Did the middle class shrink during the 1980s? UK evidence from kernel density estimates," Economics Letters, Elsevier, vol. 49(4), pages 407-413, October.
  9. Anthony B. Atkinson & Andrea Brandolini, 2011. "On the identification of the “middle class”," Working Papers 217, ECINEQ, Society for the Study of Economic Inequality.
  10. Palacios-Gonzalez, Federico & Garcia-Fernandez, Rosa, 2009. "A Multiresolution Analysis of Income Polarization," European Journal of Economic and Social Systems, Lavoisier, vol. 22(1), pages 119-142.
  11. Paapaa, Richard & van Dijk, Herman K., 1998. "Distribution and mobility of wealth of nations," European Economic Review, Elsevier, vol. 42(7), pages 1269-1293, July.
  12. Pittau, Maria Grazia & Zelli, Roberto & Johnson, Paul, . "Mixture Models and Convergence Clubs," Vassar College Department of Economics Working Paper Series 91, Vassar College Department of Economics.
  13. repec:ebl:ecbull:v:4:y:2007:i:36:p:1-6 is not listed on IDEAS
  14. Jacques SILBER & Meital Hanoka & Joseph Deutsch, 2007. "On the Link Between the Concepts of Kurtosis and Bipolarization," Economics Bulletin, AccessEcon, vol. 4(36), pages 1-6.
  15. Duro, Juan Antonio, 2005. "Another look to income polarization across countries," Journal of Policy Modeling, Elsevier, vol. 27(9), pages 1001-1007, December.
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