Sensitivity of inequality measures to extreme values

Cowell, Frank ORCID: 0000-0002-3778-2152 and Flachaire, Emmanuel (2002) Sensitivity of inequality measures to extreme values. Distributional Analysis Research Programme; DARP 60 (60). Suntory and Toyota International Centres for Economics and Related Disciplines, London.

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Abstract

We examine the sensitivity of estimates and inequality indices to extreme values, in the sense of their robustness properties and of their statistical performance. We establish that these measures are very sensitive to the properties of the income distribution. Estimation and inference can be dramatically affected, especially when the tail of the income distribution is heavy.

Item Type:	Monograph (Discussion Paper)
Official URL:	http://sticerd.lse.ac.uk
Additional Information:	© 2002 Frank A. Cowell and Emmanuel Flachaire
Divisions:	Economics STICERD Centre for Analysis of Social Exclusion
Subjects:	H Social Sciences > HB Economic Theory
JEL classification:	C - Mathematical and Quantitative Methods > C1 - Econometric and Statistical Methods: General D - Microeconomics > D6 - Welfare Economics > D63 - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
Date Deposited:	27 Apr 2007
Last Modified:	11 Dec 2024 18:31
URI:	http://eprints.lse.ac.uk/id/eprint/2213

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