Understanding Inequality Trends:Microsimulation Decomposition for Italy

Carlo Fiorio ()

STICERD - Distributional Analysis Research Programme Papers from Suntory and Toyota International Centres for Economics and Related Disciplines, LSE

Abstract: This paper suggests overcoming some limitations of traditional inequalitydecomposition methods by developing a combination of Burtless (1999) and DiNardoet al. (1996), two different microsimulation methods for decomposing inequality. Byusing this combination it is possible to take into consideration the dispersion ofincome sources as well as the socio-demographic evolution of the population understudy, in a single framework and across many years. This methodology maximizesclarity of results and allows one to easily perform tests on results. An application toItalian household inequality is provided to analyze marginal and joint effects ofdemographic trends and changed dispersion of different income factors between 1977and 2002.

Keywords: Microsimulation; counterfactual analysis; household inequality trend; inequality decomposition. (search for similar items in EconPapers)
JEL-codes: C51 D31 D63 (search for similar items in EconPapers)
Date: 2006-02
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Citations: View citations in EconPapers (1)

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https://sticerd.lse.ac.uk/dps/darp/DARP78.pdf (application/pdf)

Related works:
Working Paper: Understanding inequality trends: microsimulation decomposition for Italy (2006)
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Persistent link: https://EconPapers.repec.org/RePEc:cep:stidar:78

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