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Rethinking Inequality Decomposition, With Evidence from Rural China

Author

Listed:
  • Jonathan Morduch

    (New York University)

  • Terry Sicular

    (University of Western Ontario)

Abstract

We examine inequality decompositions by income source and describe a general, regression-based approach for decomposing inequality. The approach provides an efficient and flexible way to quantify the roles of variables like education and age in a multivariate context. We illustrate the method using survey data from China. The empirical results demonstrate how sharply different conclusions can emerge for different decomposition rules. We explain how these differences reflect the treatment of equally-distributed sources of income, and we discuss implications for how results from inequality decomposition are interpreted. Copyright Royal Economic Society 2002

Suggested Citation

  • Jonathan Morduch & Terry Sicular, 2002. "Rethinking Inequality Decomposition, With Evidence from Rural China," Economic Journal, Royal Economic Society, vol. 112(476), pages 93-106, January.
    • Handle: RePEc:ecj:econjl:v:112:y:2002:i:476:p:93-106
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    References listed on IDEAS

    as
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    8. Jonathan Morduch & Terry Sicular, 2002. "Rethinking Inequality Decomposition, With Evidence from Rural China," Economic Journal, Royal Economic Society, vol. 112(476), pages 93-106, January.
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