Permutation Tests for Comparing Inequality Measures

ABSTRACT

Asymptotic and bootstrap tests for inequality measures are known to perform poorly in finite samples when the underlying distribution is heavy-tailed. We propose Monte Carlo permutation and bootstrap methods for the problem of testing the equality of inequality measures between two samples. Results cover the Generalized Entropy class, which includes Theil’s index, the Atkinson class of indices, and the Gini index. We analyze finite-sample and asymptotic conditions for the validity of the proposed methods, and we introduce a convenient rescaling to improve finite-sample performance. Simulation results show that size correct inference can be obtained with our proposed methods despite heavy tails if the underlying distributions are sufficiently close in the upper tails. Substantial reduction in size distortion is achieved more generally. Studentized rescaled Monte Carlo permutation tests outperform the competing methods we consider in terms of power.     

How consistent are perceptions of inequality?

Despite recent empirical evidence on the importance of perceived inequality, its analysis is still underexplored. In this paper we study whether unobserved perceptions of inequality are reflected in observed individual opinions in a consistent fashion. Inconsistency is relevant to ealuate the level of agreement that individuals share with respect to different domains of inequality.Using the wave from the 2009 International Social Survey Program in the US, we show that inequality is a complicated concept prone to inconsistencies and propose a testing procedure to an empirical appraisal. We find that inconsistencies exist though they may not extend to all the domains of inequality. This inconsistency also emerges by analyzing the relation between unobserved perceptions and political treatment suggesting the hypothesis that inconsistency may be associated with a set of relevant political preferences.     

Visible and invisible hands intertwined: State-market symbiotic interactions and changing income inequality in urban China

Analyzing the restructured political economy in 21st-century urban China, this project develops a “symbiotic interaction” model and reconceptualizes the state-market relationship to appreciate the changing inequality patterns. As the state and market have formed a long-term, intimate relationship, dynamic state policies interact with the fragmented labor market to redefine a set of socioeconomic capitals and statuses in affecting income inequality. Drawing empirical evidence from the Chinese General Social Survey 2003 and 2013 data, this paper employs linear and unconditional quantile regressions to compare income disparity patterns along both temporal and socio-spatial dimensions. The findings show that multiple key factors, including human capital (e.g., college education), political capital (e.g., party membership), occupational status (e.g., self-employment), and organizational type (e.g., state-owned enterprise), have all changed their economic returns over time and also played different roles for various earning groups. These findings suggest that we should conduct substantive institutional analyses of the evolving state-market relationship and their interplay to achieve a deeper understanding of the reshuffled stratification order in contemporary China. The proposed analytical framework also has broad implications in the research of other transitional economies.     

Bell不等式实验检验的重大进展——Weihs实验和Rowe实验述评

Weihs实验（1998）和Rowe实验（2001）可能是自Aspect实验（1982）以来已完成的几十个Bell型实验中最重要的两个。这两个实验已分别地封闭了定域性漏洞和效率漏洞,但定域隐变量理论并没有完全被排除。相信有朝一日人们会完成一个无漏洞的实验。即使如此,定域隐变量理被排除的问题仍然会是悬而未决的。断言试图通过完成一个无争议的判决性实验来解决定域隐变量理论与量子力学的冲突是不可能的。     

Inequality and public good provision: An experimental analysis

Recent studies report that economic inequality is associated with reduced government expenditures on social programs. Several prominent social scientists, including Putman (Putnam, R., 2000. Bowling Alone. Simon and Schuster, New York), attribute this to the detrimental “psychosocial effects” of group heterogeneity on cooperation. We test the hypothesis that inequality within a group reduces individual contributions in a public goods experiment. Unlike previous examinations of inequality and public good provision, we introduce inequality by manipulating the levels and distributions of fixed payments given to subjects. When made salient through public information about each individual's standing within the group, inequality reduces contributions to the public good for all group members.     

Evaluating Effectively Maintained Inequality: School and post-school transitions,socioeconomic background,academic ability and curricular placement

Effectively Maintained Inequality (EMI) is proposed as an explanation for contemporary socioeconomic inequalities in education. Socioeconomic inequalities are ‘maintained’ by students from lower socioeconomic backgrounds taking less advantageous curricula influencing their post-school destinations. The purpose of this study is to evaluate EMI by addressing several hypotheses derived from the EMI thesis using Australian longitudinal data. It analyses within-school transitions and the transition from school to post-school destinations (elite university, other university, vocational and no post-school study or training). The study also models curricular placement (subject choice). It finds that the transitions within- and post-school are more powerfully influenced by students’ academic ability than by socioeconomic background. Furthermore, subject choice has strong impacts on the transitions. Similarly, Year 12 subject choice is only weakly predicted by socioeconomic background, and more strongly influenced by ability and occupational interests. In turn, occupational interests are largely independent of socioeconomic background. The EMI thesis is not supported.     

Inequality in Human Development across the Globe

The Human Development Index is the world's most famous indicator of the level of development of societies. A disadvantage of this index is however that only national values are available, whereas within many countries huge subnational variation in development exists. We therefore have developed the Subnational Human Development Index (SHDI), which shows within-country variation in human development across the globe. Covering more than 1,600 regions within 161 countries, the SHDI and its underlying dimension indices provide a 10 times higher resolution picture of human development than previously available. The newly observed within-country variation is particularly strong in low- and middle-developed countries. Education disparities explain most SHDI inequality within low-developed countries, and standard of living differences are most important within the more highly developed ones. Strong convergence forces operating both across and within countries have compensated the inequality enhancing force of population growth. These changes will shape the twenty-first century agenda of scientists and policy-makers concerned with global distributive justice.     

Welfare Generosity in Europe: A Multi‐level Study of Material Deprivation and Income Poverty among Disadvantaged Groups

The aim of this study is to analyze whether and to what extent welfare generosity moderates the risk of income poverty and material deprivation among disadvantaged groups, that is, people with ill health, low education and lack of employment. The data are based on the 2009 European Union Statistics on Income and Living Conditions (cross‐sectional) surveys. The analyses comprise 27 and 28 European countries, including 292,874 and 302,343 individuals between 18 and 64 years of age. Multi‐level analyses demonstrated that welfare generosity moderated the risk of both material deprivation and income poverty. With few exceptions, the risk decreased among disadvantaged groups in absolute terms. Among individuals who experienced the combinations of limiting long‐standing illness and either low education or non‐employment, the absolute inequalities in material deprivation decreased with increasing welfare generosity. Also, the absolute inequalities in income poverty among individuals who experienced the combination of limiting long‐standing illness and low education were lower in more generous welfare contexts. Results indicated lower absolute levels of both material deprivation and income poverty among disadvantaged individuals in generous welfare states. However, for material deprivation the results were more substantial and consistent than for income poverty. Taken together, these findings support the view that generous welfare states reach the worst‐off and are successful in buffering material deprivation and income poverty and, hence, in reducing social inequalities.     

农村教育领域的性别不平等与贫困

中国农村教育领域的性别不平等主要表现在对子女教育期望的性别差异、学校设置性别意识的缺失、家庭教育资源分配的性别差异、男女生受教育年限的差异等方面。传统的观念、传统劳动分工模式和社会安全保障体系的缺乏等因素影响了农村教育的性别模式,贫困也是影响教育性别不平等的重要因素。中国贫困农村的农户由于多种生计资本供给不足,而呈现出非常典型的男孩优先的教育模式,从而导致妇女陷入多元贫困状态。     

Should commodity tax rates be uniform across regions in a heterogeneous country? Evidence from India

With countries increasingly adopting the Goods and Services Tax (GST) as their system of commodity taxes replacing the myriad of sales, excise and other form of indirect taxes, there is a move towards the two features that characterize the GST: uniform tax rates across items and identical tax rates across regions. When India introduced the GST in 2017, it followed several other countries in departing from the first feature but in keeping with universal practice embraced the second feature. The chief motivation of this paper is to subject this latter feature to critical scrutiny. The study examines the four GST rates in India by comparing them with counterfactual evidence based on preference based optimal commodity tax rates estimated by taking into account regional diversity in prices and spending. The benchmarking suggests that the current top GST rates (12%, 16% and 28%) are much higher than can be justified by the optimal rates. The Indian evidence is also in favor of departing from the universal practice in GST of adopting a uniform tax across items. The paper makes a methodological contribution by proposing a procedure for calculating spatial prices that can be applied to a wide basket of items. The study provides evidence on the redistributive potential of indirect taxation by showing the progressive nature of the optimal commodity taxes. The latter result is of particular significance in developing countries where indirect taxes raise the greater share of revenue and provide an important policy tool for tackling increasing inequality. The study concludes with a list of policy lessons as the country seeks to make further changes to its GST. While there is a significant literature on harmonization of indirect taxes across countries that belong to a single economic grouping such as the EU, there is no such literature between regions within a large heterogeneous country. The present study on tax harmonization between the states in India attempts to fill this gap.