Statistical Inference for 2 Measures of Inequality when Incomes are Correlated
This paper derives the asymptotic normality of the distribution of difference in the Atkinson/Kolm and generalised entropy inequality measures when incomes are correlated. We illustrate the procedure by calculating the difference in inequality before and after tax in Ireland. Our empirical results suggest that the positive correlation between incomes before and after taxes substantially reduces the variance of the estimated difference in equality.
|Date of creation:||Oct 1998|
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Web page: http://www.maynoothuniversity.ie/economics-finance-and-accounting
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- Russell Davidson & Jean-Yves Duclos, 1997.
"Statistical Inference for the Measurement of the Incidence of Taxes and Transfers,"
Econometric Society, vol. 65(6), pages 1453-1466, November.
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