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Sample Sizes for Reliably Estimating Lower and Upper Income Shares in Income Distribution Analysis

Author

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  • Charles Beach

Abstract

This paper uses distribution-free formulas for the asymptotic variances of sample quantile income shares – as typically published by statistical agencies as measures of the distribution of income inequality – to calculate how large a survey sample must be in order to estimate a more refined quantile breakdown for a given level of confidence. The approach is applied to decile and quintile earnings data to calculate required increases in sample size to obtain tail 5 percent quantal share estimates and to test changes in income shares. Simple rules of thumb are offered for such a required increase.

Suggested Citation

  • Charles Beach, 2023. "Sample Sizes for Reliably Estimating Lower and Upper Income Shares in Income Distribution Analysis," Working Paper 1505, Economics Department, Queen's University.
    • Handle: RePEc:qed:wpaper:1505
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    File URL: https://www.econ.queensu.ca/sites/econ.queensu.ca/files/wpaper/qed_wp_1505.pdf
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    More about this item

    Keywords

    Income share standard errors; sample size; 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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