Factor decomposition of spatial income inequality: a revision

Juan Duro

Working Papers from Department of Applied Economics at Universitat Autonoma of Barcelona

Abstract: Duro and Esteban (1998) proposed an additive decomposition of Theil populationweighted index by four income multiplicative factors (in spatial contexts). This note makes some additional methodological points: first, it argues that interaction effects are taken into account in the factoral indexes although only in a fairly restrictive way. As a consequence, we suggest to rewrite the decomposition formula as a sum of strict Theil indexes plus the interactive terms; second, it might be instructive to aggregate some of the initial factors; third, this decomposition can be immediately extended to the between- and within-group components.

Keywords: Theil index; inequality decomposition. (search for similar items in EconPapers)
JEL-codes: C10 F00 (search for similar items in EconPapers)
Pages: 10 pages
Date: 2003-02
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Citations: View citations in EconPapers (6)

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