Premium
AN UPPER BOUND OF THE GINI INDEX IN THE ABSENCE OF MEAN INCOME INFORMATION
Author(s) -
Ogwang Tomson
Publication year - 2006
Publication title -
review of income and wealth
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.024
H-Index - 57
eISSN - 1475-4991
pISSN - 0034-6586
DOI - 10.1111/j.1475-4991.2006.00210.x
Subject(s) - index (typography) , economics , upper and lower bounds , econometrics , bracket , statistics , value (mathematics) , mathematics , income distribution , economic inequality , inequality , computer science , mechanical engineering , mathematical analysis , world wide web , engineering
In this paper, an upper bound of the Gini index, based on grouped data, is proposed assuming that there is no information on all the group mean incomes as well as the overall mean income but the limits of the income brackets are known. An important advantage of this proposal is that conventional formulas for the upper bound of the Gini index could be applied directly by substituting the (unknown) mean income for each income bracket with the corresponding value that maximizes the grouping correction for that income bracket. The effects of varying the number and size of income brackets are investigated.