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THEILDECO: Stata module to produce refined Theil index decomposition by group and quantile


  • Tim Liao

    () (University of Illinois)

Programming Language



theildeco estimates a set of Theil inequality index decomposition by further decomposing the within-group component. Either Theil's first, or T, index or Theil's second, or L, index decomposition can be requested. These two indexes were initially presented by Theil (1967) and have been widely applied in the social and economic sciences. A further refinement of decomposing the within-group component is proposed by Liao (Socius, 2016). The refinement differentiates between shared versus different dispersion in the within-group component (method 0). Alternatively, inequality is decomposed by quantile first, and the between-group component of different quantiles can be contrasted. The user can choose the number of quantiles, such as 4 (quartiles), 5 (quintiles), or 10 (deciles). This alternative method (method 1) is also discussed in Liao (2016). The user may simply prefer to contrast two percentiles, such as the top 10% versus the remaining 90% (or method 2). The method option allows the user to choose any of the methods.

Suggested Citation

  • Tim Liao, 2016. "THEILDECO: Stata module to produce refined Theil index decomposition by group and quantile," Statistical Software Components S458187, Boston College Department of Economics.
  • Handle: RePEc:boc:bocode:s458187
    Note: This module should be installed from within Stata by typing "ssc install theildeco". The module is made available under terms of the GPL v3 ( Windows users should not attempt to download these files with a web browser.

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