Top Incomes and the Measurement of Inequality in Egypt
By all accounts, income inequality in Egypt is low and had been declining during the decade that preceded the 2011 revolution. As the Egyptian revolution was partly motivated by claims of social injustice and inequalities, this seems at odds with a...
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| Language: | English en_US |
| Published: |
World Bank, Washington, D.C.
2013
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| Online Access: | http://documents.worldbank.org/curated/en/2013/08/18089005/top-incomes-measurement-inequality-egypt http://hdl.handle.net/10986/15924 |
| Summary: | By all accounts, income inequality in
Egypt is low and had been declining during the decade that
preceded the 2011 revolution. As the Egyptian revolution was
partly motivated by claims of social injustice and
inequalities, this seems at odds with a low level of income
inequality. Moreover, while income inequality shows a
decline between 2000 and 2009, the World Values Surveys
indicate that the aversion to inequality has significantly
increased during the same period and for all social groups.
This paper utilizes a range of recently developed
statistical techniques to assess the true value of income
inequality in the presence of a range of possible
measurement issues related to top incomes, including item
and unit non-response, outliers and extreme observations,
and atypical top income distributions. The analysis finds
that correcting for unit non-response significantly
increases the estimate of inequality by just over 1
percentage point, that the Egyptian distribution of top
incomes follows rather closely the Pareto distribution, and
that the inverted Pareto coefficient is located around
median values when compared with 418 household surveys
worldwide. Hence, income inequality in Egypt is confirmed to
be low while the distribution of top incomes is not atypical
compared with what Pareto had predicted and compared with
other countries in the world. This would suggest that the
increased frustration with income inequality voiced by
Egyptians and measured by the World Values Surveys is driven
by factors other than income inequality. |
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