Question The transfer principle
A. When does a measure of inequality satisfy the transfer principle?
When a progressive transfer (i.e. a transfer from a richer to a poorer individual) reduces
the measure
1
B. Let be the income of each i-th individual, i=1

30195 POVERTY, INEQUALITY & INCOME DISTRIBUTION
Mock Midterm Exam
October 2016
Time: 60 minutes. Total points: 30
Question 1. Medians, means, and inequality [15 points]
income distribution, f(y)
Consider an economy of N individuals. The income distributio

Question. The transfer principle
A. When does a measure of inequality satisfy the transfer principle?
1
B. Let be the income of each i-th individual, i=1,2,N, so =
=1 is the average
income. Consider the mean logarithmic deviation as a measure of income i