Abstract

Various measures of inequality that have been proposed in the literature are discussed. These fall into two categories: those that measure in some objective sense—positive measures that make no explicit use of any concept of social welfare and those that measure in terms of a normative notion of social welfare and the loss incurred from unequal distribution. The characteristics of positive measures are described in respect of range, relative mean deviation, variance and the coefficient of variation, the standard deviation of logarithms, the Gini coefficient, and Theil's entropy measure. Normative measures are described in terms of Dalton's measure, Atkinson's measure, axioms for additive separability, and a more general measure.