Choice of Inequality Measures
Samstag, 16. April 2016 - 23:38
A tweet by Erich Michael Johnson guided me to these links:
- http://www.theguardian.com/global-development-professionals-network/2016/apr/08/global-inequality-may-be-much-worse-than-we-think?CMP=share_btn_tw
- http://triplecrisis.com/our-misleading-measure-of-income-and-wealth-inequality-the-standard-gini-coefficient/
- http://www.economics.ox.ac.uk/Department-of-Economics-Discussion-Paper-Series/the-global-distribution-of-income
By the way, what is called the “absolute Gini index” in one article, can be expressed by the “welfare function” very well. As far I know, Amartya Sen came up with that measure. Fore income distributions, it is computed as W=meanIncome *(1-Z), where Z is an inequality measure. Amartya Sen initially took the Gini inequality measure for Z, James E. Foster proposed an Atkinson inequality measure.
And yes, global inequality if incomes has “exploded” in the last decades.
I think that the critizism of the “Gini index” in these article misses the point. All those inequality measures (with Gini’s, Theil’s, Atkinson’s, Kolm’s measures among the 50-or-so inhabitants in Coulters zoo) are fine, but we need to know, what those inequality indices mean to people. Here experiments can be used to check the theories: Yoram Amiel’s Thinking about Inequality: Personal Judgement and Income Distributions (1997) could help you.
(“Choice of Inequality Measures” comes close to “Ungleichverteilungskoeffizientenwahl” in German.)