IDEAS home Printed from https://ideas.repec.org/p/inq/inqwps/ecineq2006-39.html

Some searches may not work properly. We apologize for the inconvenience.

   My bibliography  Save this paper

Measuring Bipolarization, Inequality, Welfare and Poverty

Author

Listed:
  • Juan Gabriel Rodríguez

    (Universidad Rey Juan Carlos)

Abstract

This paper analyzes the relationship between bipolarization and inequality, welfare and poverty measures. First, we clarify the similarities and differences between bipolarization and inequality measures. Second, it is shown that bipolarization is the difference between the welfare levels of the richer and poorer income groups when feelings of identification between individuals are based on their utility functions. In fact, bipolarization is interpreted as the welfare of the richer group that is wasted to compensate for income bipolarization. Third, a relationship between bipolarization measurement and the normalized poverty deficit index is established. These findings are applied to the polarization measures of Wolfson (1994), Esteban and Ray (1994) and Lasso de la Vega and Urrutia (2006).

Suggested Citation

  • Juan Gabriel Rodríguez, 2006. "Measuring Bipolarization, Inequality, Welfare and Poverty," Working Papers 39, ECINEQ, Society for the Study of Economic Inequality.
    • Handle: RePEc:inq:inqwps:ecineq2006-39
    as

    Download full text from publisher

    File URL: http://www.ecineq.org/milano/WP/ECINEQ2006-39.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Frank A. Cowell, 1980. "On the Structure of Additive Inequality Measures," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 47(3), pages 521-531.
    2. Esteban, Joan & Ray, Debraj, 1994. "On the Measurement of Polarization," Econometrica, Econometric Society, vol. 62(4), pages 819-851, July.
    3. Foster, James & Greer, Joel & Thorbecke, Erik, 1984. "A Class of Decomposable Poverty Measures," Econometrica, Econometric Society, vol. 52(3), pages 761-766, May.
    4. Lambert, Peter J & Aronson, J Richard, 1993. "Inequality Decomposition Analysis and the Gini Coefficient Revisited," Economic Journal, Royal Economic Society, vol. 103(420), pages 1221-1227, September.
    5. Michael C. Wolfson, 1997. "Divergent Inequalities: Theory And Empirical Results," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 43(4), pages 401-421, December.
    6. Wolfson, Michael C, 1994. "When Inequalities Diverge," American Economic Review, American Economic Association, vol. 84(2), pages 353-358, May.
    7. Juan G. Rodríguez & Rafael Salas, "undated". "Extended Bi-Polarization And Inequality Measures," Working Papers 10-03 Classification-JEL , Instituto de Estudios Fiscales.
    8. Newbery, David, 1970. "A theorem on the measurement of inequality," Journal of Economic Theory, Elsevier, vol. 2(3), pages 264-266, September.
    9. Jean-Yves Duclos & Joan Esteban & Debraj Ray, 2004. "Polarization: Concepts, Measurement, Estimation," Econometrica, Econometric Society, vol. 72(6), pages 1737-1772, November.
    10. You‐Qiang Wang & Kai‐Yuen Tsui, 2000. "Polarization Orderings and New Classes of Polarization Indices," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 2(3), pages 349-363, July.
    11. Sheshinski, Eytan, 1972. "Relation between a social welfare function and the gini index of income inequality," Journal of Economic Theory, Elsevier, vol. 4(1), pages 98-100, February.
    12. 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.
    13. Conchita D’Ambrosio & Edward N. Wolff, 2006. "Is Wealth Becoming More Polarized in the United States?," Chapters, in: Edward N. Wolff (ed.), International Perspectives on Household Wealth, chapter 12, Edward Elgar Publishing.
    14. Shlomo Yitzhaki, 1979. "Relative Deprivation and the Gini Coefficient," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 93(2), pages 321-324.
    15. Conchita D’ambrosio, 2001. "Household Characteristics and the Distribution of Income In Italy: An Application of Social Distance Measures," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 47(1), pages 43-64, March.
    16. Ravallion, Martin & Chen, Shaohua, 1997. "What Can New Survey Data Tell Us about Recent Changes in Distribution and Poverty?," The World Bank Economic Review, World Bank, vol. 11(2), pages 357-382, May.
    17. repec:bla:revinw:v:46:y:2000:i:4:p:457-74 is not listed on IDEAS
    18. Juan Prieto-Rodríguez & Juan Gabriel Rodríguez & Rafael Salas, "undated". "Interactions Inequality-Polarization: Characterization Results(*)," Working Papers 15-05 Classification-JEL , Instituto de Estudios Fiscales.
    19. Duclos, Jean-Yves & Echevin, Damien, 2005. "Bi-polarization comparisons," Economics Letters, Elsevier, vol. 87(2), pages 249-258, May.
    20. Satya R. Chakravarty & Amita Majumder, 2001. "Inequality, Polarisation and Welfare: Theory and Applications," Australian Economic Papers, Wiley Blackwell, vol. 40(1), pages 1-13, March.
    21. Pyatt, Graham, 1976. "On the Interpretation and Disaggregation of Gini Coefficients," Economic Journal, Royal Economic Society, vol. 86(342), pages 243-255, June.
    22. repec:bla:jpbect:v:2:y:2000:i:3:p:349-63 is not listed on IDEAS
    23. Ma Casilda Lasso de la Vega & Ana Marta Urrutia, 2006. "An Alternative Formulation of the Esteban-Gradín-Ray Extended Measure of Polarization," Journal of Income Distribution, Ad libros publications inc., vol. 15(I), pages 42-54, December.
    24. repec:bla:revinw:v:43:y:1997:i:4:p:401-21 is not listed on IDEAS
    25. Ma Casilda Lasso de la Vega & Ana Marta Urrutia, 2006. "An Alternative Formulation of the Esteban-Gradín-Ray Extended Measure of Polarization," Journal of Income Distribution, Ad libros publications inc., vol. 15(3-4), pages 42-54, December.
    26. John D. Hey & Peter J. Lambert, 1980. "Relative Deprivation and the Gini Coefficient: Comment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 95(3), pages 567-573.
    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. Abdelkrim Araar, 2008. "Social Classes, Inequality and Redistributive Policies in Canada," Cahiers de recherche 0817, CIRPEE.
    2. Abdelkrim Araar & Luis Huesca, 2014. "Comparison of the Tax System Progressivity Over Time: Theory and Application with Mexican Data," Cahiers de recherche 1419, CIRPEE.
    3. C. Chameni Nembua, 2012. "On a class of bi-polarization variance-based measurement: evidence from Cameroonian data," Applied Economics Letters, Taylor & Francis Journals, vol. 19(13), pages 1311-1317, September.
    4. Luis Huesca Reynoso & Abdelkrim Araar, 2016. "Comparison of fiscal system progressivity over time: theory and application in Mexico," Estudios Económicos, El Colegio de México, Centro de Estudios Económicos, vol. 31(1), pages 3-45.

    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. Juan Gabriel Rodríguez, 2015. "A Class of Social Welfare Functions That Depend on Mean Income and Income Polarization," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 61(3), pages 422-439, September.
    2. Fabio Clementi & Francesco Schettino, 2013. "Income polarization in Brazil, 2001-2011: A distributional analysis using PNAD data," Economics Bulletin, AccessEcon, vol. 33(3), pages 1796-1815.
    3. Ma Casilda Lasso de la Vega & Ana Urrutia & Henar Díez, 2010. "Unit Consistency And Bipolarization Of Income Distributions," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 56(1), pages 65-83, March.
    4. Satya Chakravarty & Bhargav Maharaj, 2012. "Ethnic polarization orderings and indices," Journal of Economic Interaction and Coordination, Springer;Society for Economic Science with Heterogeneous Interacting Agents, vol. 7(1), pages 99-123, May.
    5. Joan Esteban & Debraj Ray, 2005. "A Comparison of Polarization Measures," Working Papers 310, Barcelona School of Economics.
    6. Walter Bossert & William Schworm, 2008. "A Class of Two‐Group Polarization Measures," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 10(6), pages 1169-1187, December.
    7. Michal Brzezinski, 2013. "Income Polarization and Economic Growth," LIS Working papers 587, LIS Cross-National Data Center in Luxembourg.
    8. Mariateresa Ciommi & Chiara Gigliarano & Giovanni Maria Giorgi, 2019. "Bonferroni And De Vergottini Are Back: New Subgroup Decompositions And Bipolarization Measures," Working Papers 439, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.
    9. Chiara Gigliarano & Karl Mosler, 2009. "Constructing indices of multivariate polarization," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 7(4), pages 435-460, December.
    10. Chiara Gigliarano & Daniel Nowak & Karl Mosler, 2019. "A Polarization Index for Overlapping Groups," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 65(4), pages 712-735, December.
    11. Jean-Yves Duclos & Joan Esteban & Debraj Ray, 2004. "Polarization: Concepts, Measurement, Estimation," Econometrica, Econometric Society, vol. 72(6), pages 1737-1772, November.
    12. Fuad Aleskerov & Victoria Oleynik, 2016. "Multidimensional Polarization Index and its Application to an Analysis of the Russian State Duma," Papers 1608.01351, arXiv.org.
    13. Iñaki Permanyer, 2012. "The conceptualization and measurement of social polarization," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 10(1), pages 45-74, March.
    14. Juan Prieto-Rodríguez & Juan Gabriel Rodríguez & Rafael Salas, "undated". "Interactions Inequality-Polarization: Characterization Results(*)," Working Papers 15-05 Classification-JEL , Instituto de Estudios Fiscales.
    15. Marta Pascual & David Cantarero & Paloma Lanza, 2018. "Health polarization and inequalities across Europe: an empirical approach," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 19(8), pages 1039-1051, November.
    16. Abdelkrim Araar, 2008. "On the Decomposition of Polarization Indices: Illustrations with Chinese and Nigerian Household Surveys," Cahiers de recherche 0806, CIRPEE.
    17. Azomahou, Théophile T. & Diene, Mbaye, 2012. "Polarization patterns in economic development and innovation," Structural Change and Economic Dynamics, Elsevier, vol. 23(4), pages 421-436.
    18. Azomahou, Theophile & Diene, Mbaye, 2012. "Income polarization and innovation: Evidence from African economies," MERIT Working Papers 2012-048, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    19. Chiara Assunta Ricci & Sergio Scicchitano, 2021. "Decomposing changes in income polarization by population group: what happened during the crisis?," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 38(1), pages 235-259, April.
    20. Peter Lambert, 2010. "James Foster and Michael Wolfson’s 1992 paper “Polarization and the decline of the middle class”," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 8(2), pages 241-245, June.

    More about this item

    Keywords

    bipolarization; inequality; welfare; poverty.;
    All these keywords.

    JEL classification:

    • D39 - Microeconomics - - Distribution - - - Other
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • H30 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - General

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:inq:inqwps:ecineq2006-39. 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: Maria Ana Lugo (email available below). General contact details of provider: https://edirc.repec.org/data/ecineea.html .

    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.