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The Journal of Economic Inequality

, Volume 9, Issue 4, pp 509–528 | Cite as

Inequality decompositions—a reconciliation

  • Frank A. Cowell
  • Carlo V. Fiorio
Article

Abstract

We show how classic source-decomposition and subgroup-decomposition methods can be reconciled with regression methodology used in the recent literature. We also highlight some pitfalls that arise from uncritical use of the regression approach. The LIS database is used to compare the approaches using an analysis of the changing contributions to inequality in the United States and Finland.

Keywords

Inequality Decomposition 

JEL Classification

D63 

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Copyright information

© Springer Science+Business Media, LLC. 2011

Authors and Affiliations

  1. 1.STICERDLondon School of EconomicsLondonUK
  2. 2.DEAS and EconpubblicaUniversity of MilanMilanItaly

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