Income Composition Inequality

Ranaldi, Marco

doi:10.1111/roiw.12503

Cited by 22 publications

(28 citation statements)

References 42 publications

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“…To complement and expand such historical analysis, this paper studies this relationship in Italy over the past three decades. To this end, it focuses on a new inequality dimension recently introduced by Ranaldi (2021), called income composition inequality .…”

Section: Introductionmentioning

confidence: 99%

The Evolution of Income Composition Inequality in Italy, 1989–2016

Iacono

Ranaldi

2021

Review of Income and Wealth

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We study the evolution of inequality in income composition in terms of capital and labor income in Italy between 1989 and 2016. We document a rise in the share of capital income accruing to the bottom of the distribution, while the top of the distribution increases its share of labor income. This implies a falling degree of income composition inequality in the period considered and a weaker relationship between the functional and personal distribution of income in Italy. This result is robust to various specifications of self‐employment income; nonetheless, it hinges crucially on the treatment of rental incomes. While the dynamics of imputed rents has brought about a more equitable distribution of capital incomes across the income distribution, that of actual rents has led to higher concentration of capital incomes at the top in the decade preceding the outbreak of the financial crisis. Finally, we conceptualize a rule of thumb for policy makers seeking to reduce income inequality in the long run.

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Section: Introductionmentioning

confidence: 99%

The Evolution of Income Composition Inequality in Italy, 1989–2016

Iacono

Ranaldi

2021

Review of Income and Wealth

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“…As Milanovic (2017 and and Ranaldi (2021) show, ICI fluctuates through time and space. In previous centuries, the affluent commanded capital income while the poor only relied on their wages.…”

Section: Income Composition Inequality (Ici) Captures This Variationmentioning

confidence: 89%

“…Our dependent variable is income composition inequality. ICI links the functional and the personal income distributions (Ranaldi 2021). While the former captures how total output is split between capital and labor, the latter reflects how total income is dis- The IFC index is a non-rank based measure of the association between total income and a given income source.…”

Section: Data and Measuresmentioning

confidence: 99%

Determinants of Income Composition Inequality

Petrova¹,

Ranaldi²

2021

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This paper examines the political determinants of income composition inequality in 32 advanced and emerging economies between 2006 and 2018. Income composition inequality is defined as the extent to which the income composition in capital and labor income is unevenly distributed across the income distribution. High levels of income composition inequality are associated with class-fragmented societies, whereas low levels are typical of multiple-sources-of-income societies. We find that a higher seat share of left parties in the governing coalition and higher globalization, as measured by trade, capital openness, and FDI inflows, are linked to lower income composition inequality. Higher economic development and a higher capital income share are, instead, related to higher inequality in income composition. We discuss the mechanisms behind these relationships and check the robustness of our findings. To our knowledge, this is one of the first studies looking into the causes of the dynamics of this dimension of economic inequality. (Stone Center on Socio-Economic Inequality Working Paper)

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“…Then, a high level of income composition inequality -e. g., high concentration of capital income in the top 3 -means a strong relationship between functional and personal distributions (Ranaldi, 2021;Ranaldi and Milanović, 2021). However, Ranaldi (2021) does not relate all the three Lorenz curves. In fact, the author compares the total income Lorenz curve with the so-called "concentration curves" of wealth and wages, 1 Capital stock and wealth are interchangeable expressions in this paper.…”

Section: Introductionmentioning

confidence: 97%

“…To address this topic, Ranaldi (2021) develops the concept of income composition inequality, which is measured by the distribution of factor incomes across the total income distribution. Then, a high level of income composition inequality -e. g., high concentration of capital income in the top 3 -means a strong relationship between functional and personal distributions (Ranaldi, 2021;Ranaldi and Milanović, 2021). However, Ranaldi (2021) does not relate all the three Lorenz curves.…”

Section: Introductionmentioning

confidence: 99%

Functional and personal income distributions

Patrão

Acypreste

2022

Preprint

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The economic relations between functional income distribution and the three main personal income distributions --- total income, wealth, and wages --- are not straightforward in the economic literature. This paper presents an attempt to relate the factor shares and these personal income distributions in a more direct and precise manner. Our analytical result proves that the total income Lorenz curve is always above the weighted average of capital income and wages Lorenz curves, where the factor shares are the weights. We also establish a method to estimate income, wages, or wealth personal distributions when one of them does not exists.

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Income Composition Inequality

Cited by 22 publications

References 42 publications

The Evolution of Income Composition Inequality in Italy, 1989–2016

The Evolution of Income Composition Inequality in Italy, 1989–2016

Determinants of Income Composition Inequality

Functional and personal income distributions

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