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Linking Yitzhaki’s and Dagum’s Gini Decompositions

Author

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  • Stéphane Mussard

    () (Lameta, Université Montpellier I)

  • Patrick Richard

    () (GREDI, Département d'économique, Université de Sherbrooke)

Abstract

In this article we show that the Gini coefficient is simultaneously decomposable both by sources of income and by populations of income receivers for non-overlapping income distributions: the so-called first-best Gini multi-decomposition. We show that this multidimensional decomposition is useful for many reasons: (i) it is related to the degree of inequality aversion of the decision maker, (ii) it is especially well suited to study inequalities between poor and non-poor people, (iii) it enables one to measure the impact of marginal tax reforms on within- and between-group, respectively.

Suggested Citation

  • Stéphane Mussard & Patrick Richard, 2008. "Linking Yitzhaki’s and Dagum’s Gini Decompositions," Cahiers de recherche 08-21, Departement d'Economique de l'École de gestion à l'Université de Sherbrooke.
    • Handle: RePEc:shr:wpaper:08-21
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    File URL: http://gredi.recherche.usherbrooke.ca/wpapers/GREDI-0821.pdf
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Mussard, Stéphane & Pi Alperin, Maria Noel, 2011. "Poverty growth in Scandinavian countries: A Sen multi-decomposition," Economic Modelling, Elsevier, vol. 28(6), pages 2842-2853.
    2. Mussini, Mauro, 2013. "On decomposing inequality and poverty changes over time: A multi-dimensional decomposition," Economic Modelling, Elsevier, vol. 33(C), pages 8-18.
    3. St鰨ane Mussard & Luc Savard, 2012. "The Gini multi-decomposition and the role of Gini's transvariation: application to partial trade liberalization in the Philippines," Applied Economics, Taylor & Francis Journals, vol. 44(10), pages 1235-1249, April.
    4. Ogwang Tomson, 2016. "The Marginal Effects in Subgroup Decomposition of the Gini Index," Journal of Official Statistics, Sciendo, vol. 32(3), pages 733-745, September.
    5. Yawo A. Noglo & Namponndi Kader Ouedraogo, 2020. "Using Dagum's Gini decomposition to assess households' asset-based gap in the regions of Burkina Faso," Economics Bulletin, AccessEcon, vol. 40(3), pages 2241-2253.
    6. Jurkatis, Simon & Strehl, Wolfgang, 2014. "Gini decompositions and Gini elasticities: On measuring the importance of income sources and population subgroups for income inequality," Discussion Papers 2014/22, Free University Berlin, School of Business & Economics.

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    More about this item

    Keywords

    Extended Gini; Multidimensional Decomposition; Tax reforms;
    All these keywords.

    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution

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