Global inequality: How large is the effect of top incomes?

Despite the growing interest in global inequality, assessing inequality trends is a major challenge becauseindividual data on income or consumption is not often available. Nevertheless, the periodic release of cer-tain summary statistics of the income distribution has become increasingly common. Hen...

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Detalhes bibliográficos
Autores: Jordá, Vanesa, Niño Zarazúa, Miguel
Formato: artículo
Fecha de publicación:2019
País:España
Recursos:Universidad de Cantabria (UC)
Repositorio:UCrea Repositorio Abierto de la Universidad de Cantabria
Idioma:inglés
OAI Identifier:oai:repositorio.unican.es:10902/18215
Acesso em linha:http://hdl.handle.net/10902/18215
Access Level:acceso abierto
Palavra-chave:Top incomes
Income distribution
Truncated Lorenz curves
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spelling Global inequality: How large is the effect of top incomes?Jordá, VanesaNiño Zarazúa, MiguelTop incomesIncome distributionTruncated Lorenz curvesDespite the growing interest in global inequality, assessing inequality trends is a major challenge becauseindividual data on income or consumption is not often available. Nevertheless, the periodic release of cer-tain summary statistics of the income distribution has become increasingly common. Hence, groupeddata in form of income shares have been conventionally used to construct inequality trends based onlower bound approximations of inequality measures. This approach introduces two potential sourcesof measurement error: first, these estimates are constructed under the assumption of equality of incomeswithin income shares; second, the highest income earners are not included in the household surveysfrom which grouped data is obtained. In this paper, we propose to deploy a flexible parametric model,which addresses these two issues in order to obtain a reliable representation of the income distributionand accurate estimates of inequality measures. This methodology is used to estimate the recent evolutionof global interpersonal inequality from 1990 to 2015 and to examine the effect of survey under-coverageof top incomes on the level and direction of global inequality. Overall, we find that item non-response atthe top of the distribution substantially biases global inequality estimates, but, more importantly, itmight also affect the direction of the trends.The authors hereby acknowledge UNU-WIDER and the project World Inequality where an earlier version of this study was published. The authors are grateful to Stephen Jenkins, Branko Milanovic, Nora Lustig, Juan Gabriel Rodriguez, Gustavo Marrero, Roy Van der Weide and participants at the UM Sustainability and Development Conference, Seventh ECINEQ Meeting, the 33th Annual Congress of the European Economic Association, and UNU-WIDER internal seminar series for helpful comments on earlier versions of this paper. Vanesa Jorda wishes to acknowledge financial support from the Ministerio de Economía y Competitividad (Project ECO2016-76203-C2-1-P).ElsevierUniversidad de Cantabria20192019-11-01journal articlehttp://purl.org/coar/resource_type/c_6501NAhttp://purl.org/coar/version/c_be7fb7dd8ff6fe43info:eu-repo/semantics/articlehttp://hdl.handle.net/10902/18215World development 123 (2019), 104593reponame:UCrea Repositorio Abierto de la Universidad de Cantabriainstname:Universidad de Cantabria (UC)Inglésengopen accesshttp://purl.org/coar/access_right/c_abf2Attribution-NonCommercial-NoDerivatives 4.0 Internationalhttp://creativecommons.org/licenses/by-nc-nd/4.0/info:eu-repo/semantics/openAccessoai:repositorio.unican.es:10902/182152026-06-02T12:39:31Z
dc.title.none.fl_str_mv Global inequality: How large is the effect of top incomes?
title Global inequality: How large is the effect of top incomes?
spellingShingle Global inequality: How large is the effect of top incomes?
Jordá, Vanesa
Top incomes
Income distribution
Truncated Lorenz curves
title_short Global inequality: How large is the effect of top incomes?
title_full Global inequality: How large is the effect of top incomes?
title_fullStr Global inequality: How large is the effect of top incomes?
title_full_unstemmed Global inequality: How large is the effect of top incomes?
title_sort Global inequality: How large is the effect of top incomes?
dc.creator.none.fl_str_mv Jordá, Vanesa
Niño Zarazúa, Miguel
author Jordá, Vanesa
author_facet Jordá, Vanesa
Niño Zarazúa, Miguel
author_role author
author2 Niño Zarazúa, Miguel
author2_role author
dc.contributor.none.fl_str_mv Universidad de Cantabria
dc.subject.none.fl_str_mv Top incomes
Income distribution
Truncated Lorenz curves
topic Top incomes
Income distribution
Truncated Lorenz curves
description Despite the growing interest in global inequality, assessing inequality trends is a major challenge becauseindividual data on income or consumption is not often available. Nevertheless, the periodic release of cer-tain summary statistics of the income distribution has become increasingly common. Hence, groupeddata in form of income shares have been conventionally used to construct inequality trends based onlower bound approximations of inequality measures. This approach introduces two potential sourcesof measurement error: first, these estimates are constructed under the assumption of equality of incomeswithin income shares; second, the highest income earners are not included in the household surveysfrom which grouped data is obtained. In this paper, we propose to deploy a flexible parametric model,which addresses these two issues in order to obtain a reliable representation of the income distributionand accurate estimates of inequality measures. This methodology is used to estimate the recent evolutionof global interpersonal inequality from 1990 to 2015 and to examine the effect of survey under-coverageof top incomes on the level and direction of global inequality. Overall, we find that item non-response atthe top of the distribution substantially biases global inequality estimates, but, more importantly, itmight also affect the direction of the trends.
publishDate 2019
dc.date.none.fl_str_mv 2019
2019-11-01
dc.type.none.fl_str_mv journal article
http://purl.org/coar/resource_type/c_6501
NA
http://purl.org/coar/version/c_be7fb7dd8ff6fe43
dc.type.openaire.fl_str_mv info:eu-repo/semantics/article
format article
dc.identifier.none.fl_str_mv http://hdl.handle.net/10902/18215
url http://hdl.handle.net/10902/18215
dc.language.none.fl_str_mv Inglés
eng
language_invalid_str_mv Inglés
language eng
dc.rights.none.fl_str_mv open access
http://purl.org/coar/access_right/c_abf2
Attribution-NonCommercial-NoDerivatives 4.0 International
http://creativecommons.org/licenses/by-nc-nd/4.0/
dc.rights.openaire.fl_str_mv info:eu-repo/semantics/openAccess
rights_invalid_str_mv open access
http://purl.org/coar/access_right/c_abf2
Attribution-NonCommercial-NoDerivatives 4.0 International
http://creativecommons.org/licenses/by-nc-nd/4.0/
eu_rights_str_mv openAccess
dc.publisher.none.fl_str_mv Elsevier
publisher.none.fl_str_mv Elsevier
dc.source.none.fl_str_mv World development 123 (2019), 104593
reponame:UCrea Repositorio Abierto de la Universidad de Cantabria
instname:Universidad de Cantabria (UC)
instname_str Universidad de Cantabria (UC)
reponame_str UCrea Repositorio Abierto de la Universidad de Cantabria
collection UCrea Repositorio Abierto de la Universidad de Cantabria
repository.name.fl_str_mv
repository.mail.fl_str_mv
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