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On the Measurement of Functional Income Distribution

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Abstract

This study aims to develop a methodological architecture, which sheds light on the structure of functional income classes. A functional income class is here defined as a group of individuals whose income, at the aggregate level, is simultaneously fueled by different factor shares, in specific propositions. A new index that captures the distribution of functional income among groups of people is proposed: the Functional Income Distribution Index(If ), which will take various mathematical forms throughout the article. It is shown how the simplest version of the If is closely connected to the Gini Index, and how some other properties of the coefficient can be further derived. After a first methodological examination, a brief empirical analysis test the If

Suggested Citation

  • Marco Ranaldi, 2016. "On the Measurement of Functional Income Distribution," Documents de travail du Centre d'Economie de la Sorbonne 16051, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
    • Handle: RePEc:mse:cesdoc:16051
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    More about this item

    Keywords

    Factor Shares; Functional Income; Inequality; Statistical Methodology;
    All these keywords.

    JEL classification:

    • C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation
    • E25 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Aggregate Factor Income Distribution

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