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Decomposition of Bivariate Inequality Indices by Attributes Revisited

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  • Martyna Kobus

    () (Faculty of Economic Sciences, University of Warsaw)

Abstract

Decomposability of multidimensional inequality indices by attributes is considered a highly desired property. Naga and Geoffard (2006) provided for it in case of three bivariate indices. To this end, they introduced the notion of a copula function into inequality measurement theory which, as a measure of association, is a natural concept for the study of decomposability. We show that the decomposition obtained is unrelated to copulas, and prove that two indices do not admit decomposition if association is indeed measured via copula. Most notably, the proof reveals a necessary property of indices decomposable via copulas which is similar to well-known separability property.

Suggested Citation

  • Martyna Kobus, 2010. "Decomposition of Bivariate Inequality Indices by Attributes Revisited," Working Papers 2010-07, Faculty of Economic Sciences, University of Warsaw.
  • Handle: RePEc:war:wpaper:2010-07
    as

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    File URL: http://www.wne.uw.edu.pl/inf/wyd/WP/WNE_WP30.pdf
    File Function: First version, 2010
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    References listed on IDEAS

    as
    1. Abul Naga, Ramses H. & Geoffard, Pierre-Yves, 2006. "Decomposition of bivariate inequality indices by attributes," Economics Letters, Elsevier, vol. 90(3), pages 362-367, March.
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    More about this item

    Keywords

    multidimensional inequality; decomposition by attributes; copula function;

    JEL classification:

    • 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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