No abstract

This research is based on the decompositions of the Gini index. The two existing procedures of decomposition are connected: subgroup decomposition and income source decomposition. This bidimensional decomposition enables the computation of some new determinants of inequalities. It is possible to reckon the contribution of each source to the within-group and the between-group components of the overall inequality. This bidimensional decomposition is applied to the Italian consumption in 1989 and 2000.

The paper explores different applications of the Shapley value for either inequality or poverty measures. We first investigate the problem of source decomposition of inequality measures, the so-called additive income sources inequality games, baed on the Shapley Value, introduced by Chantreuil and Trannoy (1999) and Shorrocks (1999). We show that multiplicative income sources inequality games provide dual results compared with Chantreuil and Trannoy's ones. We also investigate the case of multiplicative poverty games for which indices are non additively decomposable in order to capture contributions of sub-indices, which are multiplicatively connected with, as in the Sen-Shorrocks-Thon poverty index. We finally show in the case of additive poverty indices that the Shapley value may be equivalent to traditional methods of decomposition such as subgroup consistency and additive decompositions.