Measuring Inequality Using Electronic Payment Data

Carlos Piccioni, Saulo Bastos and Daniel Cajueiro

No 608, Working Papers Series from Central Bank of Brazil, Research Department

Abstract: We measure municipal-level inequality based on electronic payment data, specifically credit card and Pix payments, which we consider as a proxy for consumption. Our consumption inequality measure is correlated with income inequality calculated using census data, and it exhibits similar regional behavior, although it indicates higher inequality on average, given the nature of the data used. As an application, we assess the relationship between our inequality measure and the Economic Complexity Index (ECI) at the municipal level. We find a negative relationship, indicating that higher economic complexity is associated with lower consumption inequality. Additionally, the relationship is non-linear: with increasing ECI, the influence on consumption inequality becomes more significant.

Date: 2024-11
New Economics Papers: this item is included in nep-geo and nep-pay
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