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A simple correction to remove the bias of the gini coefficient due to grouping

Van Ourti, Tom; Clarke, Philip


Abstract-We propose a first-order bias correction term for the Gini index to reduce the bias due to grouping. It depends on only the number of individuals in each group and is derived from a measurement error framework. We also provide a formula for the remaining second-order bias. Both Monte Carlo and EU and U.S. empirical evidence show that the first-order correction reduces a considerable share of the bias, but that some remaining second-order bias is increasing in the variance. We propose a...[Show more]

CollectionsANU Research Publications
Date published: 2011
Type: Journal article
Source: Review of Economics and Statistics
DOI: 10.1162/REST_a_00103


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