On the Normative Measurement of Inequality

S. R. Osmani

 

Abstract

Recent attempts at devising normative measures of inequality are critically examined in this paper. It is argued that some of the well-known measures are operationally irrelevant in comparing inequality between situation involving unequal total incomes. In addition, a new approach is suggested for comparison of inequality in the face of both unequal total incomes and different price structures. The framework of ‘constant price comparison of named goods vectors’ which has recently been employed for real national income comparison, is used for this purpose. The operational relevance of the new approach is also critically examined.


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