Inequality measurement and the time structure of household income in Israel |
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Authors: | Yoel Finkel Yevgeny Artsev Shlomo Yitzhaki |
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Affiliation: | (1) Central Bureau of Statistics, 66 Kanfei Nesharim, Corner Bachi St., Jerusalem, 95464, Israel;(2) Central Bureau of Statistics and Department of Economics, Hebrew University, Jerusalem, 91905, Israel |
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Abstract: | The aim of this paper is to empirically evaluate the effect of the length of the accounting period on indices of inequality of household income in Israel. There are three main findings: (1) The analysis of the impact of the accounting period on the Gini index of inequality can be done in a way which is identical to analyzing the effect of the accounting period on the coefficient of variation; (2) changing the accounting period from one to three months decreases, on average, the Gini index of inequality by about 1.7%. Furthermore, the Gini index calculated from a three-month accounting period was 3.9%–4.1% higher than the index based on a 12-month period. The change in the accounting period from 12 months to three months accounts for 27% to 37% of the increase in inequality in the last two decades, depending on the type of income considered. (3) The above relationship is stable over the years but is sensitive to the definition of income. |
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Keywords: | decomposition Gini correlation inequality time |
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