Inequality Decomposition by Population Subgroups and the Analysis of Interdistributional Inequality

Abstract

In empirical studies of the size distribution of incomes, a question is often encountered which concerns the extent to which inequality in the total population is a consequence of income differences between population subgroups classified by characteristics such as age, gender, race, educational level or area of residence. (1975), for example, suggested neutralizing the effect of age before measuring income inequality; his proposal has been commented on by many authors (e.g., Danziger, 1977; Johnson, 1977, Kurien, 1977; Minarik, 1977; Nelson, 1977; Paglin, 1977; Wertz, 1979; Formby and Seaks, 1980; Formby, Seaks and Smith, 1989; Paglin, 1989).