A Unified Framework to Measuring Inequality in The Arab Countries

The purpose of this paper is to apply a general and unified approach to inequality measurement in Arab countries. To this end, a wide class of inequality indices, proposed by Olmedo et al. (2009) and based on the Bonferroni (1930) curve, rather than the Lorenz curve, is used. When local measures of inequality are aggregated using an appropriate weighting system, familiar indices such as the Gini index can be retrieved. The choice of the weighting system yields a variety of inequality measures that depend on which part of the income distribution the overall inequality index is focused. Our framework offers a reassessment of inequality trends in the Arab world. Our results show that whatever the trend of inequality experienced by the selected Arab countries, the poorest people do not seem to be much affected by the changes in the inequality patterns. For instance, when some countries undergo a rise in overall inequality, changes in the inequality experienced by the poorest population are less pronounced. Inversely, when inequality decreases, the richest percentiles seem to become locally more equal than poorer ones. These findings imply that change in the average income of the poorest is generally very low.