Decomposition by subpopulations of the Zenga-84 inequality curve and the related index \(\zeta \): an application to 2014 Bank of Italy survey

Abstract

This paper describes an innovative procedure to decompose by subpopulations the values assumed by the Zenga-84 inequality curve Z(p). This decomposition allows to identify the contributions to the inequality at the subpopulation level, feature that the most of the decomposition procedures do not have. Since the synthetic inequality index \(\zeta \) is obtained as the average of the values of Z(p)—which are appropriate relative variations—the results of such first decomposition can be used to obtain many other different decompositions of the synthetic index \(\zeta \). In this framework, the classical decomposition of the index \(\zeta \) in the “Between” and the “Within” components can be performed as a special case. The proposed procedure is illustrated through an application with real data from a sample survey provided by Bank of Italy in 2015.

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Correspondence to Francesco Porro.

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Porro, F., Zenga, M. Decomposition by subpopulations of the Zenga-84 inequality curve and the related index \(\zeta \): an application to 2014 Bank of Italy survey. Stat Methods Appl 29, 187–207 (2020). https://doi.org/10.1007/s10260-019-00459-9

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Keywords

  • Income inequality
  • Decomposition by subpopulations
  • Inequality curve Z(p)
  • Inequality index \(\zeta \)
  • Cograduation table