IDEAS home Printed from https://ideas.repec.org/h/eme/reinzz/s1049-258520140000022012.html
   My bibliography  Save this book chapter

Inequality, Welfare, and Order Statistics

In: Economic Well-Being and Inequality: Papers from the Fifth ECINEQ Meeting

Author

Listed:
  • Encarnación M. Parrado-Gallardo
  • Elena Bárcena-Martín
  • Luis J. Imedio-Olmedo

Abstract

In this paper, we use the distributions of order statistics to define functions with the appropriate properties to represent social preferences regarding income distributions. Following the approach of Yaari (1987, 1988), this allows constructing a set of social welfare functions from which the corresponding inequality indices are derived. The obtained measures incorporate diverse normative criteria, with different degrees of preference for equality. The generalized Gini coefficients and the family of indices proposed by Aaberge (2000) are obtained as particular cases. This approach allows interpreting each inequality measure in terms of the statistics computed from a randomly selected sample and the identification of unbiased estimators of the Social Welfare Functions. It also shows that each of the families of inequality indices are obtained from the moments of the order statistics and, therefore, each of the families characterizes any income distribution with finite mean. This characterization is very useful in the case of distributions with heavy tail and pronounced positive skew that shows only a few potential moments.

Suggested Citation

  • Encarnación M. Parrado-Gallardo & Elena Bárcena-Martín & Luis J. Imedio-Olmedo, 2014. "Inequality, Welfare, and Order Statistics," Research on Economic Inequality, in: Economic Well-Being and Inequality: Papers from the Fifth ECINEQ Meeting, volume 22, pages 383-399, Emerald Group Publishing Limited.
    • Handle: RePEc:eme:reinzz:s1049-258520140000022012
    DOI: 10.1108/S1049-258520140000022012
    as

    Download full text from publisher

    File URL: https://www.emerald.com/insight/content/doi/10.1108/S1049-258520140000022012/full/html?utm_source=repec&utm_medium=feed&utm_campaign=repec
    Download Restriction: no
    File URL: https://www.emerald.com/insight/content/doi/10.1108/S1049-258520140000022012/full/epub?utm_source=repec&utm_medium=feed&utm_campaign=repec&title=10.1108/S1049-258520140000022012
    Download Restriction: no
    File URL: https://www.emerald.com/insight/content/doi/10.1108/S1049-258520140000022012/full/pdf?utm_source=repec&utm_medium=feed&utm_campaign=repec
    Download Restriction: no
    File URL: https://libkey.io/10.1108/S1049-258520140000022012?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Oihana Aristondo & José Luis García-Lapres & Casilda Lasso de la Vega & Ricardo Alberto Marques Pereira, 2012. "Classical inequality indices, welfare functions, and the dual decomposition," Working Papers 253, ECINEQ, Society for the Study of Economic Inequality.
    2. Edward Anderson & Lucio Esposito, 2014. "On the joint evaluation of absolute and relative deprivation," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 12(3), pages 411-428, September.
    3. Mariateresa Ciommi & Chiara Gigliarano & Giovanni Maria Giorgi, 2019. "Bonferroni And De Vergottini Are Back: New Subgroup Decompositions And Bipolarization Measures," Working Papers 439, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.
    4. Subramanian, Sreenivasan, 2012. "On a Distance Function-Based Inequality Measure in the Spirit of the Bonferroni and Gini Indices," WIDER Working Paper Series 062, World Institute for Development Economic Research (UNU-WIDER).

    More about this item

    Keywords

    Inequality aversion; Lorenz curves; order statistic; social preference function; transfers; C10; D31; I30;
    All these keywords.

    JEL classification:

    • C10 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - General
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • I30 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eme:reinzz:s1049-258520140000022012. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Emerald Support (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.