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| Author: | Almas, I. (et. al) |
| Title: | Measuring unfair (in)equality |
| Journal: | Journal of Public Economics
2011 : AUG, VOL 95:7-8 p. 488-499 |
| Index terms: | inequality income distribution welfare economics Norway |
| Freeterms: | wages |
| Language: | eng |
| Abstract: | This paper presents a way of generalizing the standard framework of inequality measurement to diversify between fair and unfair inequalities. The unfairness Lorenz curve and the unfairness Gini - generalizations of the standard versions - are introduced. With this more general framework, we study the implications of responsibility-sensitive theories of justice for the income distribution assessment in Norway between 1986-2005. We find that both the pre-tax and the post-tax income distributions have become more unfair in Norway, although the standard Gini for the pre-tax income distribution has decreased. Two trends explain this: the increase in the top percentile's income share and the changed situation of females in the labor market. The concentration of income at the top of the distribution has an effect on both increased unfairness and inequality, whereas the females' increased working hours and education level mostly contributes to a reduction in inequality. Hence, the latter effect dominates for the standard Gini and the former effect for the unfairness Gini. Furthermore, we encounter that the increase in post-tax unfairness is even larger than the increase in pre-tax unfairness, showing that the tax system in Norway has become less effective in eliminating unfairness. |
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