Consumption is commonly used as a proxy for permanent income. We go a step further by establishing the link between the distribution of consumption and that of permanent income in terms of dominance orderings. We introduce two new dominance orderings, the Generalized Top Lorenz test and the related affluence ordering. If consumption is a concave function of permanent income, we get an indirect and robust method to detect a change in permanent income concentration when the full stream of income receipts along the life cycle is unknown and only consumption data are available. Our application onUS data for the period 1980–2002 points out the difficult start in life of people belonging to the “Baby loser generation” (people born in the sixties) with respect to the previous and following cohort.

Michelangeli, A., Peluso, E., Trannoy, A. (2011). Detecting a change in wealth concentration without the knowledge of the wealth distribution. THE JOURNAL OF ECONOMIC INEQUALITY, 9(3), 373-391 [10.1007/s10888-010-9160-1].

Detecting a change in wealth concentration without the knowledge of the wealth distribution

MICHELANGELI, ANNA ALESSANDRA;
2011

Abstract

Consumption is commonly used as a proxy for permanent income. We go a step further by establishing the link between the distribution of consumption and that of permanent income in terms of dominance orderings. We introduce two new dominance orderings, the Generalized Top Lorenz test and the related affluence ordering. If consumption is a concave function of permanent income, we get an indirect and robust method to detect a change in permanent income concentration when the full stream of income receipts along the life cycle is unknown and only consumption data are available. Our application onUS data for the period 1980–2002 points out the difficult start in life of people belonging to the “Baby loser generation” (people born in the sixties) with respect to the previous and following cohort.
Articolo in rivista - Articolo scientifico
Concavity, Wealth, Affluence orderings, Consumption
English
373
391
19
Michelangeli, A., Peluso, E., Trannoy, A. (2011). Detecting a change in wealth concentration without the knowledge of the wealth distribution. THE JOURNAL OF ECONOMIC INEQUALITY, 9(3), 373-391 [10.1007/s10888-010-9160-1].
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Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/10281/21245
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