2018
DOI: 10.2478/foli-2018-0009
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Income Inequality in Poland and the United Kingdom. Decomposition of the Theil Index

Abstract: The aim of the article is to compare inequalities of the household disposable income in Poland and the UK. We analyse the Theil index for types of households in 2005 and 2014. We also aim at finding out how household types contribute to the level of overall income inequality in the UK and Poland. We calculate and decompose the Theil indices based on the equivalised disposable household income from the European Union Statistics on Income and Living Conditions (EU-SILC) database. We find that "two adults below 6… Show more

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Cited by 6 publications
(3 citation statements)
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“…The θ L (mean logarithmic deviation) is more sensitive to changes at the lower tail of a distribution, while θ T is more sensitive to changes at the upper tail 35 36. The θ L and θ T can be calculated using the following mathematical expressions37–39:…”
Section: Methodsmentioning
confidence: 99%
“…The θ L (mean logarithmic deviation) is more sensitive to changes at the lower tail of a distribution, while θ T is more sensitive to changes at the upper tail 35 36. The θ L and θ T can be calculated using the following mathematical expressions37–39:…”
Section: Methodsmentioning
confidence: 99%
“…Thus, it is possible to analyse their contribution to the total differences and to identify the main sources of the overall differences [89]. This is an important property of the Theil index measure, as this additive decomposability implies that the aggregate inequality measure can be broken down into inequality within and between any defined population subgroups [90]. The main pitfall of the Theil index is that its values are not always comparable across completely different units, as in case of different nations.…”
Section: Gs-gas Supplymentioning
confidence: 99%
“…If the area is divided into m groups, the Theil index can be decomposed in two components: the Theil index of within-group inequalities and Theil index of between-group inequalities. The within-group component describes a part of overall inequality that is due to inequality within subgroups, while the between-group component measures the extent of inequality due to the differences in the group mean income [ 35 ].…”
Section: Methodsmentioning
confidence: 99%