Top Expenditure Distribution in Arab Countries and the Inequality Puzzle

Vladimir Hlasny

No 549, Working Papers from ECINEQ, Society for the Study of Economic Inequality

Abstract: This study was motivated by reports of a mismatch between inequality experienced on the streets across the Arab region, and that estimated in household expenditure surveys. The study uses eleven surveys from Egypt, Jordan, Palestine, Sudan and Tunisia to investigate whether the dispersion of top expenditures and measurement errors in them bias the measurement of inequality. The expenditure distributions are corrected by replacing potentially mismeasured values with those drawn from parametric distributions. Across all surveys, expenditure inequality is found to be at or below that found in emerging countries worldwide. The Gini is consistently 0.30–0.32 in Egypt, 0.35–0.37 in Jordan, and 0.38–0.43 in Palestine, Sudan and Tunisia. Several surveys include outliers raising inequality estimates. The Egyptian, Palestinian, and Tunisian surveys exhibit smoother top tails of expenditures, approximable by parametric distributions. Across years leading up to the Arab Spring, the estimates in these countries show falling inequality, suggesting that data problems are not behind the Arab inequality puzzle.

Keywords: Top expenditures; economic inequality; Pareto law; Arab region. (search for similar items in EconPapers)
JEL-codes: D31 D63 N35 (search for similar items in EconPapers)
Pages: 46 pages
Date: 2020-07
New Economics Papers: this item is included in nep-ara
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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