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A Useful Empirical Tool Box for Distributional Analysis

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  • Charles Beach

Abstract

This paper offers a tool box of disaggregative measures of distributional change, including population shares, income shares, quantile mean incomes and relative mean incomes of different income groups. It highlights median-based measures along with quintiles and deciles. It also offers formulas for the measures’ standard errors and a common framework for statistical inference on these measures. Illustrating these tools with Census and LFS microdata, the paper highlights the substantial decline in earnings shares and relative mean earnings levels of middle-class workers in Canada since 1980 and the corresponding dramatic rise in these measures for higher earners in the labour market.

Suggested Citation

  • Charles Beach, 2021. "A Useful Empirical Tool Box for Distributional Analysis," Working Paper 1466, Economics Department, Queen's University.
    • Handle: RePEc:qed:wpaper:1466
    as

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    File URL: https://www.econ.queensu.ca/sites/econ.queensu.ca/files/wpaper/qed_wp_1466.pdf
    File Function: First version 2021
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    References listed on IDEAS

    as
    1. DiNardo, John & Fortin, Nicole M & Lemieux, Thomas, 1996. "Labor Market Institutions and the Distribution of Wages, 1973-1992: A Semiparametric Approach," Econometrica, Econometric Society, vol. 64(5), pages 1001-1044, September.
    2. Lawrence F. Katz & Kevin M. Murphy, 1992. "Changes in Relative Wages, 1963–1987: Supply and Demand Factors," The Quarterly Journal of Economics, Oxford University Press, vol. 107(1), pages 35-78.
    3. Charles M. Beach, 2016. "Changing income inequality: A distributional paradigm for Canada," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 49(4), pages 1229-1292, November.
    4. Brahim Boudarbat & Thomas Lemieux & W. Craig Riddell, 2010. "The Evolution of the Returns to Human Capital in Canada, 1980-2005," Canadian Public Policy, University of Toronto Press, vol. 36(1), pages 63-89, March.
    5. David A. Green & Benjamin M. Sand, 2015. "Has the Canadian labour market polarized?," Canadian Journal of Economics, Canadian Economics Association, vol. 48(2), pages 612-646, May.
    6. Russell Davidson, 2018. "Statistical Inference on the Canadian Middle Class," Econometrics, MDPI, vol. 6(1), pages 1-18, March.
    7. Charles M. Beach, 2016. "Changing income inequality: A distributional paradigm for Canada," Canadian Journal of Economics, Canadian Economics Association, vol. 49(4), pages 1229-1292, November.
    8. Maarten Goos & Alan Manning & Anna Salomons, 2014. "Explaining Job Polarization: Routine-Biased Technological Change and Offshoring," American Economic Review, American Economic Association, vol. 104(8), pages 2509-2526, August.
    9. Beach, Charles M. & Chow, K. Victor & Formby, John P. & Slotsve, George A., 1994. "Statistical inference for decile means," Economics Letters, Elsevier, vol. 45(2), pages 161-167, June.
    10. Daron Acemoglu & David Autor & David Dorn & Gordon H. Hanson & Brendan Price, 2016. "Import Competition and the Great US Employment Sag of the 2000s," Journal of Labor Economics, University of Chicago Press, vol. 34(S1), pages 141-198.
    11. Shorrocks, Anthony F, 1983. "Ranking Income Distributions," Economica, London School of Economics and Political Science, vol. 50(197), pages 3-17, February.
    12. Rubin Saposnik, 1981. "Rank-dominance in income distributions," Public Choice, Springer, vol. 36(1), pages 147-151, January.
    13. Charles M. Beach & Russell Davidson, 1983. "Distribution-Free Statistical Inference with Lorenz Curves and Income Shares," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 50(4), pages 723-735.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Charles Beach, 2021. "A Nifty Fix for Published Distribution Statistics: Simplified Distribution-Free Statistical Inference," Working Paper 1477, Economics Department, Queen's University.

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    More about this item

    Keywords

    Income inequality; inequality tool box; statistical inference;
    All these keywords.

    JEL classification:

    • C12 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Hypothesis Testing: General
    • C46 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Specific Distributions
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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