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.
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TL;DR: In this paper, the authors connect the economic literature on human capital formation with findings from neurobiology and psychology on early childhood development and self-regulation, and propose a framework for assessing the distribution of agespecific returns to investment in skills.
48 citations
Cites background from "On the Measurement of Inequality"
...skill formation as introduced in chapter 4. The Atkinson Index ( Atkinson (1970) ) is a discrete...
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TL;DR: An equity adjusted formula for years of life saved has been proposed, but must be developed and revised according to each country's specific conditions and value premises.
Abstract: STUDY OBJECTIVE: To present a formula for equity adjusted years of life saved (EYLS) DESIGN: A mailed questionnaire The survey participants were given a scenario describing a trade off between a health maximization programme and a programme that is less efficient, but eliminates social inequalities SETTING: Swedish politicians responsible for health care in the county councils PARTICIPANTS: A sample of 449 Swedish politicians responsible for health care in the county councils MAIN RESULTS: The principle of health maximization was rejected Under certain conditions, the Swedish politicians are prepared to sacrifice 15 of 100 preventable deaths to achieve equity Based on the results a formula for EYLS is presented CONCLUSIONS: An equity adjusted formula for years of life saved has been proposed, but must be developed and revised according to each country's specific conditions and value premises In the future, such formulas could serve the purpose of incorporating explicit considerations of equity into cost effectiveness analyses
48 citations
TL;DR: In this article, the authors characterise voluntary consumers at an arbitrary all-or-nothing price, and the optimal price a revenue-constrained welfare-maximiser facing voluntary consumers chooses.
48 citations
TL;DR: In this paper, the authors studied the changes in the Portuguese distribution of household income and expenditure during this period, using micro-data on household budgets and applying recent developments in statistical inference for Lorenz curves.
Abstract: From 1980 to 1990 Portugal experienced a generalized liberalization of economic activity, due in large part to its 1986 integration in the European Union. This paper studies the changes in the Portuguese distribution of household income and expenditure during this period, using micro-data on household budgets and applying recent developments in statistical inference for Lorenz curves. We find a significant increase in six measures of welfare and an unambiguous decrease in the inequality of the respective distributions. Different explanations for the findings of decreased inequality are discussed.
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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
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"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]....
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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...
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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