The Social Welfare Implications of the Zenga Index

06/18/2020

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by   Francesca Greselin, et al.

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Università degli Studi di Milano-Bicocca

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Università di Torino

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Università degli Studi di Milano

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We introduce the social welfare implications of the Zenga index, a recently proposed index of inequality. Our proposal is derived by following the seminal book by Son (2011) and the recent working paper by Kakwani and Son (2019). We compare the Zenga based approach with the classical one, based on the Lorenz curve and the Gini coefficient, as well as the Bonferroni index. We show that the social welfare specification based on the Zenga uniformity curve presents some peculiarities that distinguish it from the other considered indexes. The social welfare specification presented here provides a deeper understanding of how the Zenga index evaluates the inequality in a distribution.