Abstract:
In this paper a general view of the Gini decomposition is presented. In order to decompose the Gini coefficient into within group inequality، between group inequality and transvariation inequality of the Iranian urban and rural areas، the 2006 and 2010 micro-data and Dagum (1997) method is used. The results indicate that about 48 percent of the inequality in the country as a whole has been due to within group (urban and rural) inequality. About 26 (2006) and 22 (2010) percent of the inequality has been due to the inequality between urban and rural، while 27 (2006) and 29 (2010) percent of the inequality has been because of the transvariation inequality. Although more than half of the inequality has been caused by the gross inequality between urban and rural areas، ignoring the transvariation inequality، urban inequality has the most contribution of total inequality.
Machine summary:
Analysis of the Gini Coefficient in Iran By Urban and Rural Areas Esmaeil Abounoori* Professor, Department of Economics, Semnan University (Corresponding Author) esmaiel.
The Gini index is decomposed into three factors: within-group inequality, between-group inequality, and the interaction effect among urban and rural population groups in Iran, using microdata from 1385 (2006) and 1389 (2010) and the Dygom (1997) method.
The first aim of this article is to provide an overview of the decomposition of the Gini coefficient into demographic subgroups (urban and rural areas) using the Dygom (1997) method, and then to describe the stark duality of the Iranian economy in urban and rural areas.
In this group, decomposable income inequality indices are considered, and studies by Bourguignon (1979), Shorrocks (1980, 1984), Cowell (1980), Cowell and Kuga (1981), Blundell Donaldson and Auerbach (1981), and Dygom (1997) have been conducted in this area.
Gross economic surplus between two demographic subgroups is specified as follows in a continuous state: (Refer to the page image) The above relationship indicates the income difference between groups and when and .
Therefore, in the Gini coefficient, social welfare is measured as a function of the degree of inequality within the community, and the share of welfare resulting from differences in income dispersion, asymmetry, and average economic surplus is ignored.
4. Conclusion The main objective of this article is to decompose economic inequality (Gini coefficient) into three factors: inequality within urban (rural) areas, between urban and rural areas, and the interference effect in Iran using microdata from 1385 and 1389.
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