Abstract
Based on certain desirable properties, a subset of entropy decomposition rules is proposed to assign inequality contributions to different components of income. In addition, a method of assessing the impact on inequality of marginal changes in income components originally applied to Gini index by Lerman and Yitzhaki (The Review of Economics and Statistics 67 (1985) 151) is extended to other measures of inequality. An empirical exercise based on Australian income distribution data illustrates the usefulness of the proposed analytical framework.
| Original language | English |
|---|---|
| Number of pages | 17 |
| Journal | Journal of Development Economics |
| Publication status | Published - 2004 |
Keywords
- decomposition
- income source
- inequality measures
- marginal effects
