Between-Group Pigou-Dalton Transfers

No 2007-02, IRISS Working Paper Series from IRISS at CEPS/INSTEAD

Abstract: This paper introduces the concept of Pigou-Dalton transfers between populations of income receivers. Gini's mean difference and Dagum's Gini index between populations are axiomatically derived in order to gauge the impact of within- and between-group Pigou-Dalton transfers on Dagum's measure. We show its sensitiveness for any given transfer in the sense that inequality-reducing transfers are captured when transfers occur from higher-income donors to lower-income recipients, which belong to two distinct populations. Accordingly, we point out the implications of between-group transfers on: the ordering of multivariate majorization, the multivariate stochastic dominance in the sense of multivariate Lorenz ordering and zonotope inclusions, the Gini decomposition, and on the use of the generalized entropy index.

Keywords: between-group Gini; between-group transfers; Entropy; Pigou-Dalton; within-group transfers (search for similar items in EconPapers)
JEL-codes: D31 D63 (search for similar items in EconPapers)
Pages: 23 pages
Date: 2007-04
New Economics Papers: this item is included in nep-pub
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

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Related works:
Working Paper: Between-Group Pigou Dalton Transfers (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:irs:iriswp:2007-02

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