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Inequality Decompositions - A Reconciliation

Author

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  • Carlo Fiorio

    ()

  • Frank Cowell

    ()

Abstract

We show how classic source-decomposition and subgroup-decomposition methods can be reconciled with regression methodology used in the recent literature. We also highlight some pitfalls that arise from uncritical use of the regression approach. The LIS database is used to compare the approaches using an analysis of the changing contributions to inequality in the United States and Finland.

Suggested Citation

  • Carlo Fiorio & Frank Cowell, 2009. "Inequality Decompositions - A Reconciliation," LIS Working papers 512, LIS Cross-National Data Center in Luxembourg.
  • Handle: RePEc:lis:liswps:512
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    File URL: http://www.lisdatacenter.org/wps/liswps/512.pdf
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    References listed on IDEAS

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    Keywords

    inequality; decomposition;

    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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