Differences in Needs and Assessment of Income Distributions*

Abstract

The literatures on the assessment of income distributions and on differences in needs are not well integrated. The theoretical literature providing results about evaluations and comparisons of income distributions does not, in the main, consider the implications of non‐income differences between income‐receiving units, while the equivalence scale literature providing results about the relationship between living standards, incomes and household composition does not consider distributional implications. The aim of this survey is to go some way towards integrating these separate literatures; to consider how to evaluate and compare income distributions while at the same time taking explicit account of differences in household composition.

The Impact of Minimum Wages on Wage Inequality and Employment in the Formal and Informal Sector in Costa Rica

“…3 In this paper we use the terms 'informal sector' and 'self-employed' interchangeably. 4 For further definitions see Coulter et al (1992). 5 The seven industrial sectors are: agriculture, manufacturing, construction, transportation, commerce and finance, services and domestics.…”

Accounting for the decline in Spanish household expenditures inequality during the 1980s

“…To see this, consider the formula for the GE index when written in decomposable form for the partition by household size: Coulter et al (1992a) indicate that when c = 0, using the 'wrong' equivalence scale only contaminates the between group component. In this case, denoting by U and C(Θ) the uncontaminated and the contaminated terms, respectively, we have:…”

“…5 For two parameter empirical models which take into account household composition, see Cutler and Katz (1992) and Jenkins and Cowell (1994). For a critical survey of econometric and other methods, see Coulter et al (1992a). 5 generosity of the scale.…”

“…2 equivalised income according to a single equivalence scale 3 However, as Coulter et al (1992a) conclude, there is no single 'correct' equivalence scale for adjusting incomes. Thus, a range of scale relativities is both justifiable and inevitable.…”

Sequential Stochastic Dominance and the Robustness of Poverty Orderings

“…4 Buhmann et al 1987 show the important empirical impact of di erent equivalence scale parameters on poverty measurement. Coulter et al 1992b use the same type of parameterization and analyze its implication for the theoretical impact of equivalence scales on poverty measurement see also Coulter et al 1992a. Duclos and MercaderPrats 1999 generalize the analysis for a class of parameterized equivalence scales extended to take household composition into account and nd that poverty pro les and orderings are sensitive to assumptions on needs.…”