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Factor decomposition of spatial income inequality: a revision

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  • Juan Antonio Duro

    (Departament d'Economia Aplicada, Universitat Autonoma de Barcelona)

Abstract

Duro and Esteban (1998) proposed an additive decomposition of Theil populationweighted index by four income multiplicative factors (in spatial contexts). This note makes some additional methodological points: first, it argues that interaction effects are taken into account in the factoral indexes although only in a fairly restrictive way. As a consequence, we suggest to rewrite the decomposition formula as a sum of strict Theil indexes plus the interactive terms; second, it might be instructive to aggregate some of the initial factors; third, this decomposition can be immediately extended to the between- and within-group components.

Suggested Citation

  • Juan Antonio Duro, 2003. "Factor decomposition of spatial income inequality: a revision," Working Papers wpdea0302, Department of Applied Economics at Universitat Autonoma of Barcelona.
    • Handle: RePEc:uab:wprdea:wpdea0302
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    References listed on IDEAS

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    1. Theil, Henri & Sorooshian, Cyrus, 1979. "Components of the change in regional inequality," Economics Letters, Elsevier, vol. 4(2), pages 191-193.
    2. Ram Rati, 1992. "International inequalities in human development and real income," Economics Letters, Elsevier, vol. 38(3), pages 351-354, March.
    3. Bourguignon, Francois, 1979. "Decomposable Income Inequality Measures," Econometrica, Econometric Society, vol. 47(4), pages 901-920, July.
    4. Goerlich Gisbert, Francisco J., 2001. "On factor decomposition of cross-country income inequality: some extensions and qualifications," Economics Letters, Elsevier, vol. 70(3), pages 303-309, March.
    5. Shorrocks, A F, 1980. "The Class of Additively Decomposable Inequality Measures," Econometrica, Econometric Society, vol. 48(3), pages 613-625, April.
    6. Theil, Henri, 1979. "The measurement of inequality by components of income," Economics Letters, Elsevier, vol. 2(2), pages 197-199.
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    Cited by:

    1. Friso Schlitte & Tiiu Paas, 2008. "Regional Income Inequality and Convergence Processes in the EU-25," SCIENZE REGIONALI, FrancoAngeli Editore, vol. 2008(Suppl. 2), pages 29-49.
    2. Juan Antonio Duro Moreno & Emilio Padilla Rosa, "undated". "Análisis De Los Factores Determinantes De Las Desigualdades Internacionales En Las Emisiones De Co2 Per Cápita Aplicando El Enfoque Distributivo: Una Metodología De Descomposición Por Factores De Kaya," Working Papers 25-05 Classification-JEL , Instituto de Estudios Fiscales.
    3. Padilla, Emilio & Duro, Juan Antonio, 2013. "Explanatory factors of CO2 per capita emission inequality in the European Union," Energy Policy, Elsevier, vol. 62(C), pages 1320-1328.
    4. Duro, Juan Antonio & Padilla, Emilio, 2011. "Inequality across countries in energy intensities: An analysis of the role of energy transformation and final energy consumption," Energy Economics, Elsevier, vol. 33(3), pages 474-479, May.
    5. Remuzgo, Lorena & Sarabia, José María, 2013. "Desigualdad en la distribución mundial de emisiones de CO2 por sectores: Descomposición y estudio de sensibilidad/Inequality of Global Distribution of CO2 Emissions by Sector: Decomposition and Sensit," Estudios de Economia Aplicada, Estudios de Economia Aplicada, vol. 31, pages 65-92, Enero.
    6. Duro, Juan Antonio & Padilla, Emilio, 2006. "International inequalities in per capita CO2 emissions: A decomposition methodology by Kaya factors," Energy Economics, Elsevier, vol. 28(2), pages 170-187, March.

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    More about this item

    Keywords

    Theil index; inequality decomposition.;

    JEL classification:

    • C10 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - General
    • F00 - International Economics - - General - - - General

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