Measuring Income Polarization Using an Enlarged Middle Class
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.
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- 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.
- Chakravarty, Sanya R. & Majumdar, A. & Roy, Sonali, 2007. "A Treatment of Absolute Indices of Polarization," Staff General Research Papers Archive 12811, Iowa State University, Department of Economics.
- 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.
- Juan G. Rodríguez & Rafael Salas, "undated". "Extended Bi-Polarization And Inequality Measures," Working Papers 10-03 Classification-JEL , Instituto de Estudios Fiscales.
- 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, 03.
- Andreas Peichl, 2007. "Measuring richness," German Stata Users' Group Meetings 2007 06, Stata Users Group. Full references (including those not matched with items on IDEAS)
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