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Issue LXVII - N. 3 (2009)
Transvariation and inequality between subpopulations in the Dagumâ€'s Gini index decomposition
In the framework of inequality measure decompositions, the paper intro- duces an immediate and straightforward method for the Gini index decomposition, which simplifies the Dagumâ€'s proposal. Simple expressions for the measurement of both overlapping component and inequal- ity between subpopulations are derived, which allow to correctly evaluate and compare the effects of different factors on total inequality. The simplified Dagumâ€'s Gini index decomposition is applied to the Italian household income distribution disaggregated by the educational level and geographical area of residence. The results of the empir- ical analysis indicate that the inequality between subpopulations represents the main component of the overall inequality.
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