Comparative Institutional Analysis Working Paper Series, Lund University School of Economics and Management
The inequality possibility frontier: the extensions and new applications
Abstract: The paper extends the Inequality Possibility Frontier
(IPF) approach introduced by Milanovic, Lindert and Williamson (2011) in
two methodological directions. It allows the social minimum to increase
with the average income of a society, and it derives all the IPF statistics
for two other inequality measures than the Gini. Finally, it applies the
framework to contemporary data showing that the inequality extraction ratio
can be used in the empirical analysis of post-1960 civil conflict around
the world. The duration of conflict and the casualty rate are positively
associated with the inequality extraction ratio, that is, with the extent
to which elite pushes the actual inequality closer to its maximum level.
Inequality, albeit slightly reformulated, is thus shown to play a role in
explaining civil conflict.
Keywords: inequality; inequality possibility frontier; civil war; (follow links to similar papers)
JEL-Codes: D31; N30; O10; Q30; (follow links to similar papers)
30 pages, May 1, 2013
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