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ERIC Number: EJ858836
Record Type: Journal
Publication Date: 2009
Pages: 8
Abstractor: ERIC
Reference Count: 32
ISSN: ISSN-0276-8739
New Comparative Measures of Income, Material Deprivation, and Well-Being
Smeeding, Timothy M.
Journal of Policy Analysis and Management, v28 n4 p745-752 Fall 2009
Most societies, rich and poor, seek to measure progress in reducing poverty and need, as indicated by material deprivation or social exclusion. The yardsticks used to assess progress and policy impact mainly include income-based poverty, but broader measures of poverty based on consumption, wealth, and material deprivation are also now coming into use. Both Europeans and Americans also have a strong interest in reducing income inequality: It is reported as a "serious problem" by two-thirds of survey respondents in the U.S. and over 90 percent of respondents in Europe. However, although both agree that income inequality is a social ill, there is far less consensus on how to attack the problem. Income inequality rose in most rich nations in the Organisation for Economic Cooperation and Development (OECD) over the 1990-2005 period, but by considering both tails of the income distribution, it can be seen that most of the rise in inequality was generated by increases at the top of the distribution or by the ratio of the 90th percentile income to the median income, and not by changes at the bottom or by the ratio of the 10th percentile to the median. Many analysts look at the Gini coefficient (the most popular single-parameter measure of the inequality in a country's income distribution) and see rising inequality if the Gini increases. They are, of course, technically correct. But a change in a single-parameter coefficient like the Gini does not show which part of the distribution changed, and different changes have different policy implications. If the rich pull away from the middle class, the policy implications are likely to be very different than if the poor fall farther behind the middle class. In this article, the author discusses new comparative measures of income, material deprivation, and well-being. (Contains 1 footnote.)
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Publication Type: Journal Articles; Opinion Papers; Reports - Descriptive
Education Level: N/A
Audience: N/A
Language: English
Sponsor: N/A
Authoring Institution: N/A
Identifiers - Location: United States