Inequality adjusted income growth

Demuynck, Thomas;Van De Gaer, Dirk
(2012) Economica —

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  • Demuynck, ThomasKatholieke Universiteit Leuven and Universiteit Gent
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  • Van De Gaer, DirkUniversiteit Gent
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Abstract
We introduce and characterize a new measure of aggregate income growth that allows us to give more weight to individuals with lower individual income growth. Our measure includes several important measures of directional mobility encountered in the literature. The empirical application compares the measure of income growth between the USA and Germany, and finds that giving more weight to individuals with lower income growth reverses the ranking.
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Demuynck, T., & Van De Gaer, D. (2012). Inequality adjusted income growth. Economica. https://doi.org/10.1111/j.1468-0335.2012.00931.x