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Until the recent past, the analysis of economic inequality in a country was essentially a macro level exercise. Currently, it has been well recognized that macro level inequality measure is inadequate for assessing a country's economic development and its distributional pattern. To have a clear understanding of the nature, structure and factors responsible for inequality decompositions of aggregate inequality into sectors, sources and determinants of income are essential. The concept of decompositions of inequality signifies that if the population of income recipients is partitioned into a number of subpopulations, the total inequality of the population can be expressed as sum of the inequality within the sub-populations and of the inequality between them.

As the authors point out, economic inequalities come in different forms which in turn lead to unrest of various degrees in the society. In this paper, they seek to analyse the various facts of inequality and also explore the decompositions in inequality by income class and occupational head of the household in rural Bangladesh. (DÜI-Sen)

This paper analyses the structure of the European income inequality by a decomposition in a within- and between-component. It illustrates a replication of the work of Beblo and Knaus (Rev Income Wealth 47(3):301–333, 2001) and decomposes the income inequality for the EU-28 in 2014 by using data from the European Survey on Income and Living Conditions. The Theil index is applied to additively decompose the sources of inequality into a within- and between-component by countries, country groups and demographic groups. This is done by using equivalised disposable household income and income before transfers and taxes. The results show that inequality, with regard to disposable income, is highest for households with household heads older than 59 years and lowest for households with children. Moreover, high income countries have lower inequality, higher social expenditures and show a stronger relative reduction of income inequality after transfers and taxes than low income countries. On country group level, Social-Democratic countries have the lowest income inequality and redistribute most, while the opposite holds true for Baltic countries.

This paper analyses the structure of the European income inequality by a decompo-sition in a within- and between-component. It illustrates a replication of the work of Beblo and Knaus (Rev Income Wealth 47(3):301-333, 2001) and decomposes the income inequality for the EU-28 in 2014 by using data from the European Survey on Income and Living Conditions. The Theil index is applied to additively decom-pose the sources of inequality into a within- and between-component by countries, country groups and demographic groups. This is done by using equivalised dispos-able household income and income before transfers and taxes. The results show that inequality, with regard to disposable income, is highest for households with house-hold heads older than 59 years and lowest for households with children. Moreover, high income countries have lower inequality, higher social expenditures and show a stronger relative reduction of income inequality after transfers and taxes than low income countries. On country group level, Social-Democratic countries have the lowest income inequality and redistribute most, while the opposite holds true for Baltic countries.

This study applies unconditional quantile regressions estimated using recentered influence functions to analyze income gaps based on households' residence, education and employment status in six Asian countries. China, India, Japan, Korea, Russia and Taiwan are found to represent different demographic corners of Asia and different stages of development. Rural/urban gaps exist across all six countries, particularly China, India and Russia, but have been falling in Russia. Rural households face mobility barriers and lack decent employment opportunities, thus lacking incentives for skill investment. Gaps between less/more educated households are also prevalent. Less educated households tend to be rural and face low returns on their other marketable characteristics. In China and India, gaps by employment status surprisingly favor households with non-employed heads. In India, a non-working class of rural rich live off saved wealth or remittances from urban professionals. In China, a class of rural poor appear to live off remittances from migrant laborers. We conclude that Asian emerging economies should strengthen their rural assistance programs, and lower the mobility and resettlement barriers, to improve rural households' access to education and employment.

This study applies improved household income data to measure and decompose trends in pan-European income inequality from 2006 to 2014. To contrast the relative significance of economic homogeneity versus the efficacy of welfare state and labour market institutions in shaping income distributions, we compare the structure of inequality in the 28 Member States of the European Union (EU-28) to that of the 50 United States. This comparison stands in contrast to the standard practice of evaluating the United States against individual EU Member States. Despite the greater relative heterogeneity of the EU-28 and our corrections for the underreporting of household income in the United States, post-fisc income inequality in the EU-28 remains lower than that of the United States from 2006 onward. Moreover, inequality appears to be rising in the United States, while it has remained stagnant since 2008 in the EU-28. In both unions, and particularly the United States, within-state income differences contribute more to union-wide inequality than between-state differences. In a counterfactual analysis, we find that if the EU-28 matched the between-state homogeneity of the United States, but maintained its relative within-country inequalities, pan-European inequality would fall by only 20 percent. Conversely, inequality in the United States would fall by 34 percent if it matched the within-country inequality of the EU-28. Our findings suggest that the strengthening of egalitarian institutions within the 28 Member States is more consequential than economic convergence in reducing pan-European income inequality. We highlight institutional challenges towards achieving a 'more equal' Europe and discuss implications for future EU policymaking.

ABSTRACTThis paper conducts an empirical investigation into the issue of inequality decomposition, using the 1985 FES micro data tapes for Northern Ireland. It is hoped that it makes three contributions. First, by using the raw data, it permits a fairly rich disaggregation of individuals. The disaggregation employed in this paper viz. by individuals belonging to different'family types'and individuals of different'economic status'seems particularly relevant to social policy. Second the data also permits a disaggregation of total income by type of income: this permits one to assess, for example, how much of total inequality is caused by inequality in the distribution of income from different sources. Finally, the analysis is consistent with the existing theoretical literature on inequality decomposition.The main results may be summarized briefly. When the FES sample was divided by subgroups of family type or economic status, then, in 1985, most of income inequality in NI was due to within group rather than to between group inequality. When total income was disaggregated by income type, then inequalities in the distribution of wages and salaries made the largest contribution to the inequality of total income. Prosperous families in NI tended to contain within them a far greater proportion of secondary workers than did the less well off families. It was not implausible therefore that the distribution of employment between families made a major contribution to wage inequalities between them.

Segregation of households on the dimension of income at the jurisdictional level is interesting to economists because, under some conditions, it is an equilibrium condition in the political economy models of jurisdiction choice that follow from [15]. This paper addresses the measurement of household income sorting across jurisdictions and the attribution of observed sorting to a pure Tiebout mechanism. A standard decomposition of income variance into within- and between-jurisdiction components is biased downward by roughly 50 percent due to measurement error and differences between transitory and permanent income. Adjusting US Census data accordingly, an average across US Metropolitan Areas (MSAs) of six to eight percent of income variation can be explained by differences across jurisdictions; approximately 21 percent in the much-studied Boston MSA. Variance decomposition overstates the role of locally provided public goods because jurisdictions are differentiated by both government and location. Comparing pairs of adjacent, randomly defined "neighborhoods" in the Boston MSA, I find that boundaries between physically adjacent jurisdictions explain no more than three to four percent of income variation.

In this study we present the decomposition of income inequalities between household income distributions in Poland in 2002 and 2012. The difference between two distributions may be decomposed using the counterfactual distribution, which can be constructed in various ways. Techniques such as the residual imputation approach and RIF‑regression method (recentered influence function) were considered. The application of these methods made it possible to show the aggregate detailed decompositions in different quantile points along the income distribution. The influence of several person's characteristics on the differences in income distributions was examined. By decomposing the inequalities into the explained and unexplained components it was possible to receive additional information about their causes.