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DISTRIBUTIONALLY‐SENSITIVE INEQUALITY INDICES AND THE GB2 INCOME DISTRIBUTION
Author(s) -
Jenkins Stephen P.
Publication year - 2009
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.1475-4991.2009.00318.x
Subject(s) - gini coefficient , econometrics , inequality , generalized entropy index , income distribution , economic inequality , mathematics , economics , portfolio , distribution (mathematics) , index (typography) , range (aeronautics) , statistics , lorenz curve , panel data , computer science , mathematical analysis , materials science , composite material , world wide web , financial economics
The Generalized Beta of the Second Kind (GB2) income distribution provides an excellent description of income distributions. However the degree of inequality implied by GB2 parameter estimates is typically summarized using the Gini coefficient only. This paper provides formulae for the Generalized Entropy class of inequality indices for GB2 distributions, thereby providing a full range of top‐sensitive and bottom‐sensitive measures. The usefulness of having a portfolio of distributionally‐sensitive indices is demonstrated using GB2‐based estimates of British income inequality in 1994/95 and 2004/05.