Gini decomposition: An inequality of opportunity perspective

Sandip Sarkar

Economics Letters, 2023, vol. 223, issue C

Abstract: Economic inequality that arises due to circumstances is unfair, whereas fair inequality is the one that emerges because of differences in individual efforts. We assume that an individual’s income is determined only by circumstances and efforts, where both factors are evident and can be ordered. We then decompose the Gini coefficient into unfair, fair, and residual Gini. The last component emerges whenever circumstance and effort jointly affect income differences, where distinguishing between fair and unfair inequalities becomes impossible.

Keywords: Fair inequalities; Unfair inequalities; Gini coefficient; Relative deprivation; Inequality of opportunity (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:223:y:2023:i:c:s0165176522004499

DOI: 10.1016/j.econlet.2022.110975

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