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On analysing the world distribution of income

  • Anthony B. Atkinson

    (Nuffield College, Oxford)

  • Andrea Brandolini

    ()

    (Bank of Italy, Department for Structural Analysis)

This paper argues that consideration of world inequality should cause us to re-examine the key concepts underlying the welfare approach to the measurement of income inequality and the inter-relation between the measurement of inequality and the measurement of poverty. There are three reasons why we feel that a re-examination is necessary: (i) the extent of global income differences means that we cannot simply carry over the methods used at a national level; we need a more flexible measure; (ii) we have to reconcile measures of world inequality and world poverty; and (iii) we need to explore more fully the different ways in which measures may be relative or absolute. This leads us to propose a new measure, which (a) combines poverty and inequality, including provision for those who are concerned only with poverty, (b) incorporates different approaches to the measurement of inequality; and (c) allows the cost of inequality to be expressed in different ways. Applied to the world distribution for the period 1820-1992, the new measure provides different perspectives on the evolution of global inequality.

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File URL: http://www.ecineq.org/milano/WP/ECINEQ2008-97.pdf
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Paper provided by ECINEQ, Society for the Study of Economic Inequality in its series Working Papers with number 97.

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Length: 46 pages
Date of creation: 2008
Date of revision:
Handle: RePEc:inq:inqwps:ecineq2008-97
Contact details of provider: Web page: http://www.ecineq.org
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