Measuring Unfair (in) Equality
36 Pages Posted: 11 Feb 2010
Date Written: April 30, 2008
The standard approach to inequality measurement regards all inequalities as being unfair. However, most people do not share this view, and believe that some inequalities are fair. This paper shows one way of generalizing the standard approach to take account of the distinction between fair and unfair inequalities. Within this framework, we introduce the unfairness Lorenz curve and the unfairness Gini, which are generalizations of the standard versions of the Lorenz curve and the Gini. With this more general framework in place, we study the implications of responsibility-sensitive theories of justice for the evaluation of the income distribution in Norway from 1986 to 2005. We nd that the income distribution has become unfairer in Norway, even though the standard Gini has decreased over the same period. We show that this conclusion holds for dierent views on what individuals should be held responsible for, and for alternative specifications of the responsibility-sensitive fairness principle.
Keywords: Income inequality, Fairness
JEL Classification: D31, D63, J31
Suggested Citation: Suggested Citation