The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd

Inequality (Measurement)

  • F. A. Cowell
Reference work entry


This article provides an overview of the key issues in inequality measurement and shows how theoretical concepts are related to practical judgements. The principal axioms of distributional analysis are used to show the social-welfare underpinnings of standard ranking principles and to derive families of inequality indices. Recent developments that focus on income differences and reference income levels are examined.


Atkinson inequality index Coefficient of variation Generalized Lorenz curve Gini coefficient Index numbers Inequality (measurement) Lorenz curve Pen’s parade Poverty Poverty line Principle of transfers Ranking Relative deprivation Risk aversion Social-welfare function Theil, H. Well-being 

JEL Classifications

D63 E25 D3 
This is a preview of subscription content, log in to check access.



My thanks go to Yoram Amiel, Tony Atkinson, Sanghamitra Bandyopadhyay, Kristof Bosmans, Udo Ebert, Giovanni Ko, Peter Lambert and Abigail McKnight, who made helpful comments on an earlier draft.


  1. Atkinson, A.B. 1970. On the measurement of inequality. Journal of Economic Theory 2: 244–263.CrossRefGoogle Scholar
  2. Atkinson, A.B. 1983. The economics of inequality. 2nd ed. Oxford: Clarendon Press.Google Scholar
  3. Bossert, W., and A. Pfingsten. 1990. Intermediate inequality: Concepts, indices and welfare implications. Mathematical Social Sciences 19: 117–134.CrossRefGoogle Scholar
  4. Cowell, F.A. 2000. Measurement of inequality. In Handbook of income distribution, ed. A.B.. Atkinson and F. Bourguignon. Amsterdam: North Holland.Google Scholar
  5. Cowell, F.A. 2007. Measuring inequality. 3rd ed. Hemel Hempstead: Oxford University Press.Google Scholar
  6. Cowell, F.A., and U. Ebert. 2004. Complaints and inequality. Social Choice and Welfare 23: 71–89.CrossRefGoogle Scholar
  7. Dalton, H. 1920. Measurement of the inequality of incomes. Economic Journal 30: 348–361.CrossRefGoogle Scholar
  8. DeNavas-Walt, C., B.D. Proctor, and C.H. Lee. 2005. U.S. Census Bureau, Current Population Reports, P60–229, Income, poverty, and health insurance coverage in the United States: 2004. Washington, DC: U.S. Government Printing Office. Online. Available at Accessed 24 Nov 2006.
  9. Kolm, S.-C. 1976. Unequal inequalities I. Journal of Economic Theory 12: 416–442.CrossRefGoogle Scholar
  10. Lambert, P.J. 2001. The distribution and redistribution of income. 3rd ed. Manchester: Manchester University Press.Google Scholar
  11. Pen, J. 1974. Income distribution. 2nd ed. London: Allen Lane, Penguin Press.Google Scholar
  12. Sen, A.K., and J.E. Foster. 1997. On economic inequality. 2nd ed. Oxford: Clarendon Press.Google Scholar
  13. Shorrocks, A.F. 1983. Ranking income distributions. Economica 50: 3–17.CrossRefGoogle Scholar
  14. Temkin, L.S. 1993. Inequality. Oxford: Oxford University Press.Google Scholar
  15. Theil, H. 1967. Economics and information theory. Amsterdam: North Holland.Google Scholar

Copyright information

© Macmillan Publishers Ltd. 2018

Authors and Affiliations

  • F. A. Cowell
    • 1
  1. 1.