INEQFAC: Stata module to calculate inequality decomposition by factor components
Stephen P. Jenkins
ineqfac provides an exact decomposition of the inequality of total income into inequality contributions from each of the factor components of total income. ineqfac was designed as a tool for income distribution analysis in the case where the current sample contains observations on income components for each of a set of income receiving units (e.g. families, households, persons). In this case, facvars might include labour income, income from investments and pensions, cash transfers, etc. See Shorrocks (1982b) and Jenkins (1995) for examples. ineqfac may also be applied to summarise and compare the riskiness of portfolios of wealth holdings: s_f, the "proportionate contribution of factor f to total inequality", has exactly the same form as the "beta coefficient" used in finance analysis.
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