The Construction and Interpretation of Combined Cross-Section and Time-Series Inequality Datasets

67 Pages Posted: 17 Oct 2005

See all articles by Joseph F. Francois

Joseph F. Francois

University of Bern - Department of Economics; Centre for Economic Policy Research (CEPR); Vienna Institute of International Economic Studies (WIIW); University of Adelaide - School of Economics

Hugo Rojas-Romagosa

Tinbergen Institute - Tinbergen Institute Amsterdam (TIA)

Multiple version iconThere are 2 versions of this paper

Date Written: October 2005

Abstract

The inequality dataset compiled in the 1990s by the World Bank and extended by the United Nations has been both widely used and strongly criticized. The criticisms raise questions about conclusions drawn from secondary inequality datasets in general. The authors develop techniques to deal with national and international comparability problems intrinsic to such datasets. The result is a new dataset of consistent inequality series, allowing them to explore problems of measurement error. In addition, the new data allow the authors to perform parametric non-linear estimation of Lorenz curves from grouped data. This in turn allows them to estimate the entire income distribution, computing alternative inequality indexes and poverty estimates. Finally, the authors use their broadly comparable dataset to examine international patterns of inequality and poverty.

Keywords: Income distribution datasets, inequality trends, Lorenz curve estimation, poverty

JEL Classification: D31, C80, O15

Suggested Citation

Francois, Joseph F and Rojas-Romagosa, Hugo, The Construction and Interpretation of Combined Cross-Section and Time-Series Inequality Datasets (October 2005). World Bank Policy Research Working Paper No. 3748. Available at SSRN: https://ssrn.com/abstract=825965 or http://dx.doi.org/10.2139/ssrn.825965

Joseph F Francois (Contact Author)

University of Bern - Department of Economics ( email )

Schanzeneckstrasse 1
Bern, CH-3001
Switzerland

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Vienna Institute of International Economic Studies (WIIW) ( email )

Oppolzergasse 6
A-1010 Vienna
Austria

University of Adelaide - School of Economics ( email )

Adelaide SA, 5005
Australia
+61 8 8303 5540 (Phone)
+61 8 8223 1460 (Fax)

Hugo Rojas-Romagosa

Tinbergen Institute - Tinbergen Institute Amsterdam (TIA) ( email )

Gustav Mahlerplein 117
Amsterdam, 1082 MS
Netherlands

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