Informal Transfers in Comparisons of Income Distributions: Lessons from Rich and Middle-Income Countries

Yixia Cai () and Martin Evans
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Yixia Cai: Institute for Research on Poverty, University of Wisconsin

Journal of Income Distribution, 2018, vol. 26, issue 2, 1-20

Abstract: Developing countries rely more heavily on financial transfers between private households for economic welfare. Using data from three middle income and three high income countries in the Luxembourg Income Study Database, this paper examines the effects of such transfers on within country comparison of inequality. Deducting private transfer payments from disposable income increases inequality, but effects differ by the position of donor and receiving households in the distribution, by urban or rural location and by age of household members. We conclude that considering the role of private financial transfers is crucial to income inequality analysis.

Keywords: measurement; methodology; inequality; income distribution (search for similar items in EconPapers)
JEL-codes: I30 I31 I32 (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (2)

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Working Paper: Informal Transfers in Comparisons of Income Distributions: Lessons from Rich and Middle-Income Countries (2019)
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