Preference-Sensitive Multidimensional Inequality Measurement.

In empirical work, it is common practice to study inequality by looking at the dispersion in the income distribution. This approach has the drawback that it remains blind to non-income differences between individuals such as their health, employment, and educational outcomes. A multidimensional framework is needed to take these differences into account when measuring inequality. Yet, in a multidimensional framework different individuals may have different preferences over their multidimensional outcomes. It is an open theoretical question how an inequality measure can be constructed that takes this preference heterogeneity into account. The current project therefore investigates how the existing apparatus to measure inequality can be extended to a multidimensional framework while respecting the preferences of the concerned individuals. Two issues will be addressed in detail. First, by using an axiomatic approach a flexible class of preference-based multidimensional inequality measures with attractive properties will be studied. To do that, a novel multidimensional transfer principle that is compatible with the Pareto principle needs to be proposed. Second, a survey instrument based on insights from the stated-preference approach will be developed to estimate preferences over non-income dimensions. Combining these two answers will lead to an operational preference-sensitive multidimensional inequality measure which can be used to design and evaluate social policies.

Keywords:INCOME INEQUALITY, SOCIOLOGY

Disciplines:Applied sociology, Policy and administration, Social psychology, Social stratification, Social theory and sociological methods, Sociology of life course, family and health, Other sociology and anthropology