Normalized lifespan inequality: disentangling the longevity–lifespan variability nexus

Previous studies have documented a historically strong and negative association between countries’ life expectancy (i.e., average longevity) and length-of-life inequality (i.e., variability in ages at death). The relationship between both variables might be partially explained by life expectancy increasing at a faster pace than maximal length of life, a phenomenon that mechanically compresses the age-at-death distribution and has not been taken into consideration in previous studies. In this paper, we propose a new approach to lifespan inequality measurement that accounts for the (uncertainly) bounded nature of length-of-life. Applying the new approach to the countries of the Human Mortality Database, we observe that the decline in overall lifespan variability typically associated with increases in longevity seems to stop and even reverse at higher levels of life expectancy. This suggests the emergence of worrying ethical dilemmas, whereby higher achievements in longevity would only be possible at the expense of higher lifespan variability.

A New Goodness of Fit Measure Based on Income Inequality Curves

This paper uses inequality-measurement techniques to assess goodness of fit in income distribution models. It exposes the shortcomings of the use of conventional goodness of fit criteria in face of the big income data and proposes a new set of metrics, based on income inequality curves. In this note, we mentioned that the distance between theoretical and empirical inequality curves can be considered as a goodness of fit criterion. We demonstrate certain advantages of this measure over the other general goodness of fit criteria. Unlike other goodness of fit measures, this criterion is bounded. It is 0 in minimum difference and 1 in maximum distance. Furthermore, there is a consistency between this new goodness of fit measure and the other conventional criteria. A simulation study based on fitted distribution to real income data is performed in order to investigate some statistical properties of the new goodness of fit measure. An empirical study and comparisons are also provided.

Inequality measurement and tax/transfer policy

We provide a critique of the standard methodology for inequality measurement, which makes welfare comparisons between households by deflating household income and consumption with an equivalence scale. We argue that this leads to support for tax/transfer policies that significantly disadvantage low to middle income households and second earners—predominantly women. Its main limitations are that it takes an overly-simplistic approach to household production, bases its welfare measurements on joint household income, and has no theory of the family household. We point the way to an alternative procedure by presenting a theoretical model of the family household that derives duality-based welfare measures. In the light of current data limitations we propose, as a second best, primary earner income as a superior base to joint income for across-household welfare comparisons in policy formulation. We also emphasise the importance of taking the family life cycle into account when making such comparisons. We use the Australian income tax system and Australian income and tax data for a detailed comparison of the standard approach with our proposed alternative.

Inequality

By whatever indicator it is assessed, inequality has been rising in recent years. This book considers it a macroeconomic issue and innovates by including it among its topics. The chapter begins by reviewing evidence and facts on inequality, measurement issues, and the relation with poverty. The macroeconomic models of income distribution reviewed next include vintage models, endogenous growth models, and whether inequality can be accommodated in ‘representative-agent’ models. Attention then turns to ‘factor’ (labour-capital) income shares, which have also been changing recently, reviewing both the relevant analytics and the possible processes that underlie this change. The chapter concludes with recent debates on determinants of inequality, the evolution of the labour share (the ‘r-g’ question), and the future of income distribution.

Income-(in)dependent equivalence scales and inequality measurement

Most equivalence scales that are applied in research on inequality do not depend on income, even though there is strong empirical evidence that equivalence scales are actually income-dependent. This paper explores the consistency of results derived from income-independent and income-dependent scales. We show that applying income-independent scales when income-dependent scales would be appropriate leads to violations of the transfer principle. Surprisingly, there are some exceptions, but these require unrealistic and strong assumptions. Thus, the use of income-dependent equivalence scales almost always leads to different assessments of inequality than the use of income-independent equivalence scales. Two examples illustrate our findings.

Intergenerational Equity and Transitional Inequality Measurement: Techniques and Empirics

This paper discusses the measurement of both the intergenerational equity and the transitional inequality where the latter is a measure of distance to a transitional goal. The issue is relevant especially for ecological sustainability which is the main aspect treated, and can be extended to a set of transitional goals as the Agenda 2030. The empirics show that we had non-sustainable intergenerational equity and that no transition has been performed; therefore, it is hard to believe that there will be no necessity for inequality to reach the intergenerational equity. Keywords: Intergenerational equity; Transitional inequality; Intergenerational equity indicators; Sustainable development indicators