Inequality decomposition by population subgroups for ordinal data
We present a class of decomposable inequality indices for ordinal data (e.g. self-reported health survey). It is characterized by well-known inequality axioms (e.g. scale invariance) and a decomposability axiom which states that an index can be represented as a function of inequality values in subgroups and subgroup sizes. The only decomposable indices are strictly monotonic transformations of the weighted average of frequencies in categories. Among the indices proposed in the literature only the absolute value index (Abul Naga and Yalcin, 2008; Apouey, 2007) is decomposable. As an empirical illustration we calculate regional contributions to overall health inequality in Switzerland.
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- Shorrocks, Anthony F, 1984. "Inequality Decomposition by Population Subgroups," Econometrica, Econometric Society, vol. 52(6), pages 1369-85, November.
- Ramses H. Abul Naga & Tarik Yalcin, 2007.
"Inequality measurement for ordered response health data,"
LSE Research Online Documents on Economics
6538, London School of Economics and Political Science, LSE Library.
- Abul Naga, Ramses H. & Yalcin, Tarik, 2008. "Inequality measurement for ordered response health data," Journal of Health Economics, Elsevier, vol. 27(6), pages 1614-1625, December.
- Ramses H. Abul Naga & Tarik Yalcin, 2007. "Inequality Measurement forOrdered Response Health Data," STICERD - Distributional Analysis Research Programme Papers 92, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE.
- Allison, R. Andrew & Foster, James E., 2004. "Measuring health inequality using qualitative data," Journal of Health Economics, Elsevier, vol. 23(3), pages 505-524, May.
- Benedicte Apouey, 2007. "Measuring health polarization with self-assessed health data," Health Economics, John Wiley & Sons, Ltd., vol. 16(9), pages 875-894.
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