On the Measurement of Inequality
TL;DR: In this paper, the problem of comparing two frequency distributions f(u) of an attribute y which for convenience I shall refer to as income is defined as a risk in the theory of decision-making under uncertainty.
About: This article is published in Journal of Economic Theory.The article was published on 1970-09-01. It has received 5002 citations till now. The article focuses on the topics: Income inequality metrics & Income distribution.
Citations
More filters
TL;DR: In this article, the most appropriate measures for summarizing air traffic distributions at airports are investigated, with the Gini Index of Concentration being used extensively to analyze U.S. airport traffic patterns over a twenty-four-year period.
Abstract: This paper surveys changes in the U.S. National Airway System since the 1960s. The most appropriate measures for summarizing air traffic distributions at airports are investigated, with the Gini Index of Concentration being used extensively to analyze U.S. airport traffic patterns over a twenty-four-year period. The properties of the Gini index and other measures are compared and discussed in detail in the context of analyzing air traffic distributions. It is shown how concentration in the traffic patterns at the larger airports was at a high level prior to deregulation, but since 1978, the patterns have gradually become even more concentrated.
71 citations
TL;DR: Results demonstrate that individual differences in the perception of the ending of youth, the beginning of old age, and the length of the middle age period are more pronounced than contextual differences and suggest that individuals’ mental maps regarding the timing of these events are not necessarily concordant.
Abstract: This study evaluated macro- and micro-level variables associated with individuals’ perception of the ending of youth, the beginning of old age, and the length of the middle age period. The European Social Survey is a biennial multi-country, cross-sectional survey. Our analysis is based on the fourth wave, which included a rotating module on ageism. The source sample consisted of 28 countries and a total of 54,988 respondents. Whereas macro-level variability accounted for 14 % of the variance associated with the perception of the ending of youth, only 5.7 % of the variance associated with the perception of the beginning of old age was accounted for by macro-level variability. Almost 10 % of the variance associated with the perception of the middle age period was associated with macro-level variability. Different patterns of macro- and micro-level correlates emerged for the ending of youth, beginning of old age, and the period of middle age. Overall, results demonstrate that individual differences in the perception of the ending of youth, the beginning of old age, and the length of the middle age period are more pronounced than contextual differences. Results also suggest that individuals’ mental maps regarding the timing of these events are not necessarily concordant.
71 citations
Cites methods from "On the Measurement of Inequality"
...The Gini coefficient, on the other hand, is commonly used as a measure of inequality of income or wealth, with a higher score indicating greater inequality (Atkinson 1970)....
[...]
TL;DR: This paper assess the statistical reliability of microsimulation models in two ways: by comparing simulated outcomes with survey "actuals" and by calculating asymptotic confidence intervals for a variety of summary measures.
71 citations
TL;DR: A level-based, correctly normalized variety metric which accounts for the degree of uniformness of the distribution of concepts over nodes, is proposed, and is shown to resolve the above issues.
70 citations
TL;DR: In this paper, the relationship between income distribution and social welfare is empirically analyzed, while explicitly allowing for the interdependence of individual welfare functions, and it is found that under certain conditions (such as absence of effects of income redistribution on productivity) an equal distribution of incomes is suboptimal.
70 citations
References
More filters
TL;DR: In this article, a measure of risk aversion in the small, the risk premium or insurance premium for an arbitrary risk, and a natural concept of decreasing risk aversion are discussed and related to one another.
Abstract: This paper concerns utility functions for money. A measure of risk aversion in the small, the risk premium or insurance premium for an arbitrary risk, and a natural concept of decreasing risk aversion are discussed and related to one another. Risks are also considered as a proportion of total assets.
5,207 citations
Posted Content•
1,748 citations
"On the Measurement of Inequality" refers background in this paper
...3 See Rothschild and Stiglitz [13], Hadar and Russell [ 5 ], and Hanoch and Levy [6]....
[...]
1,738 citations
"On the Measurement of Inequality" refers methods in this paper
...Then by applying the results of Pratt [l 11, Arrow [ 2 ], and others, we can see that this requirement (which may be referred to as constant (relative) inequality-aversion) implies that U(y) has the form...
[...]
TL;DR: JSTOR as discussed by the authors is a not-for-profit organization founded in 1995 to build trusted digital archives for scholarship, which is used to preserve their work and the materials they rely upon, and to build a common research platform that promotes the discovery and use of these resources.
Abstract: you have obtained prior permission, you may not download an entire issue of a journal or multiple copies of articles, and you may use content in the JSTOR archive only for your personal, non-commercial use. Each copy of any part of a JSTOR transmission must contain the same copyright notice that appears on the screen or printed page of such transmission. JSTOR is a not-for-profit organization founded in 1995 to build trusted digital archives for scholarship. We work with the scholarly community to preserve their work and the materials they rely upon, and to build a common research platform that promotes the discovery and use of these resources. For more information about JSTOR, please contact support@jstor.org.
1,544 citations
TL;DR: In this paper, an analysis of the first step of the decision-making process of an individual decision maker among alternative risky ventures is presented, in terms of a single dimension such as money, both for the utility functions and for the probability distributions.
Abstract: Publisher Summary The choice of an individual decision maker among alternative risky ventures may be regarded as a two-step procedure. The decision maker chooses an efficient set among all available portfolios, independently of his tastes or preferences. Then, the decision maker applies individual preferences to this set to choose the desired portfolio. The subject of this chapter is the analysis of the first step. It deals with optimal selection rules that minimize the efficient set by discarding any portfolio that is inefficient in the sense that it is inferior to a member of the efficient set, from point of view of each and every individual, when all individuals' utility functions are assumed to be of a given general class of admissible functions. The analysis presented in the chapter is carried out in terms of a single dimension such as money, both for the utility functions and for the probability distributions. However, the results may easily be extended, with minor changes in the theorems and the proofs, to the multivariate case. The chapter explains a necessary and sufficient condition for efficiency, when no further restrictions are imposed on the utility functions. It presents proofs of the optimal efficiency criterion in the presence of general risk aversion, that is, for concave utility functions.
1,160 citations