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Measuring Income Polarization Using an Enlarged Middle Class


  • Chiara Gigliarano

    () (Università Politecnica delle Marche, Ancona)

  • Pietro Muliere

    () (Università Bocconi, Milano)


In this paper, a new class of polarization measures is derived axiomatically. The concept of polarization is here identified with the decline of the middle class. In particular, we extend the definition of middle class towards a more realistic framework: the middle class is defined in terms of central interval rather than median income. Then polarization is measured both as the presence of well-separated poles and as the dispersion inside the middle class. This new class of indices can be seen as a generalization of existing measures of income polarization. Also, a new polarization ordering is introduced. The new approach is illustrated with an application to EU countries.

Suggested Citation

  • Chiara Gigliarano & Pietro Muliere, 2012. "Measuring Income Polarization Using an Enlarged Middle Class," Working Papers 271, ECINEQ, Society for the Study of Economic Inequality.
  • Handle: RePEc:inq:inqwps:ecineq2012-271

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    References listed on IDEAS

    1. Satya R. Chakravarty & Amita Majumder & Sonali Roy, 2007. "A Treatment Of Absolute Indices Of Polarization," The Japanese Economic Review, Japanese Economic Association, vol. 58(2), pages 273-293.
    2. 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.
    3. Juan G. Rodríguez & Rafael Salas, "undated". "Extended Bi-Polarization And Inequality Measures," Working Papers 10-03 Classification-JEL , Instituto de Estudios Fiscales.
    4. Yoram Amiel & Frank Cowell & Xavier Ramos, 2010. "Poles Apart? An Analysis Of The Meaning Of Polarization," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 56(1), pages 23-46, March.
    5. Andreas Peichl, 2007. "Measuring richness," German Stata Users' Group Meetings 2007 06, Stata Users Group.
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    Cited by:

    1. Evridiki Tsounta & Anayochukwu Osueke, 2014. "What is Behind Latin America’s Declining Income Inequality?," IMF Working Papers 14/124, International Monetary Fund.

    More about this item


    axioms; transfers; polarization measurement; income distribution.;

    JEL classification:

    • C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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