17th of March, 2 pm, Villa La Fonte, Sala A
Sarolta Laczo, Guido Ruta, Laura Hering, MW Fellows
We first ask the question how to measure (economic) inequality. Comparing two groups of individuals, when can we say that there is more equality in one than in the other (in terms of one outcome, consumption for example, or several outcomes, consumption and health, say)? In other words, when can we say that a policy reduces inequality? What kind of criteria we would want to incorporate into a measure? We also examine the advantages and disadvantages of different measures, like the Gini, the Theil/Atkinson index, and the Hoover index. Second, we turn to economic policies implemented or proposed to reduce inequality.
Having looked at the issue of how to measure inequality, we want to have an idea of the measures of inequality over a cross section of countries and how these measures evolved in the last 30 years or so. If there has been an increase in inequality (within and across countries), what is the reason for that? We also want to address the issue of ex-ante inequality (at the time of birth) vs. ex-post inequality (over the lifetime) and how this varies in different countries and over time. Finally, we want to address the following normative issue: is too little inequality bad in terms of overall welfare? In other words, to what degree is inequality beneficial?
Readings:
- Debraj Ray. 1998. Development Economics. Chapter 6: Economic Inequality.
Princeton University Press. 169-96.
- Frank Cowell. 2000. "Measurement of Inequality" in: Tony B Atkinson and
François Bourguignon (eds), Handbook of Income Distribution
To receive the readings, please contact Holger Döring