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Poverty and inequality under income and price dispersions

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  • Christophe Muller

Abstract

. We introduce an analytical framework for welfare analysis that accounts for changes in the joint distribution of prices and incomes by using parametric formulae of poverty and inequality measures. We propose statistical indicators for the levels, variabilities and a statistical link of price indices and nominal living standards, which are consistent with a bivariate lognormal model. Our analysis provides intuitive insight about the social welfare impact of economic shocks affecting levels, variabilities, and correlation of prices and incomes. The roles of price and income variabilities for poverty and inequality are exhibited, with the possibility of several variation regimes. JEL classification: I32, O15, D31 Pauvreté et inégalité quand il y a dispersion des revenus et des prix. On propose un cadre analytique d’analyse du bien‐être qui prend en compte les changements dans les distributions conjointes des prix et des revenus à l’aide de formules paramétriques pour des mesures de pauvreté et d’inégalité. On propose des indicateurs statistiques pour les niveaux et les variabilités, et un lien statistique des indices de prix et des niveaux de vie nominaux. Ces indicateurs sont cohérents avec une approximation basée sur un modèle lognormal bivarié des indices de prix et des niveaux de vie nominaux. L’analyse révèle des enseignements intuitifs à propos de l'impact sur le bien être social des chocs économiques affectant les niveaux, variabilités et corrélation des prix et revenus. Les rôles des variabilités des prix et des revenus pour la pauvreté et l'inégalité sont mis en évidence, ainsi que la possibilité de plusieurs régimes.

Suggested Citation

  • Christophe Muller, 2005. "Poverty and inequality under income and price dispersions," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 38(3), pages 979-998, August.
    • Handle: RePEc:wly:canjec:v:38:y:2005:i:3:p:979-998
    DOI: 10.1111/j.0008-4085.2005.00312.x
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    Cited by:

    1. Christophe Muller, 2022. "Poverty Measurement under Income and Price Dispersions," Working Papers hal-03612841, HAL.
    2. Christophe Muller, 2023. "Poverty measurement under income and price dispersion," Chapters, in: Jacques Silber (ed.), Research Handbook on Measuring Poverty and Deprivation, chapter 14, pages 151-160, Edward Elgar Publishing.
    3. Karel Tomšík & Luboš Smutka, 2013. "Selected aspects and specifics of the economic development in sub-Saharan Africa," Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, Mendel University Press, vol. 61(2), pages 517-528.
    4. Christophe Muller, 2022. "Poverty Measurement under Income and Price Dispersions," AMSE Working Papers 2204, Aix-Marseille School of Economics, France.
    5. Christophe Muller, 2005. "Poverty and inequality under income and price dispersions," Canadian Journal of Economics, Canadian Economics Association, vol. 38(3), pages 979-998, August.
    6. Mussa, Richard, 2015. "A joint analysis of correlates of poverty intensity, incidence, and gap with application to Malawi," MPRA Paper 65205, University Library of Munich, Germany.

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    More about this item

    JEL classification:

    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods

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