A Unified Framework to Decomposing Inequality with Illustrations to Some Arab Countries

Sami Bibi and AbdelRahmen El-Lahga ()
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AbdelRahmen El-Lahga: University of Tunis
Authors registered in the RePEc Author Service: AbdelRahmen El Lahga ()

No 618, Working Papers from Economic Research Forum

Abstract: It is common to decompose the inequality indices of the General Entropy class to understand economic inequality and guide the design of economic policy. Elbers et al. (2008) suggest an improved approach to inequality decomposition of those indices which is less sensitive to the degree of sub-partitioning of population groups than the conventional decompositions. In this paper, we extend the approach of Elbers et al. (2008) to the ß class of inequality indices which includes a large variety of inequality indices. This class generalizes and comprises different well-known families of inequality indices as particular cases. Moreover, some of its members enable to focus on a particular part of the income distribution at which redistributive policies could be aimed. We illustrate our methodology using micro datasets from six Arab countries to offer a reassessment of between-group inequality in these countries.

Pages: 23
Date: 2011-01-08, Revised 2011-01-08
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