On the Measurement of Intermediate Inequality: A Dominance Criterion for a Ray-Invariant Notion
Francisco Azpitarte and
Olga Alonso-Villar
A chapter in Economic Well-Being and Inequality: Papers from the Fifth ECINEQ Meeting, 2014, vol. 22, pp 401-420 from Emerald Group Publishing Limited
Abstract:
This paper introduces a unit-consistent Lorenz dominance criterion that allows ranking income distributions according to centrist measures à la Seidl and Pfingsten (1997). In doing so, it definesα-Lorenz curves that generalize the absolute Lorenz curve. These curves allow implementing unanimous rankings for a broad set of centrist inequality notions, whereas they become closer and closer to the absolute curve whenαapproaches equity. In addition, this paper provides an empirical illustration of these tools using Australian income data. The results suggest that despite the reduction of relative inequality for Australian-born people between 1999 and 2003, their inequality increased for most centrist value judgments.
Keywords: Income distribution; Lorenz dominance; intermediate inequality indices; Ray-invariance; Australia; D63 (search for similar items in EconPapers)
Date: 2014
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Persistent link: https://EconPapers.repec.org/RePEc:eme:reinzz:s1049-258520140000022013
DOI: 10.1108/S1049-258520140000022013
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