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Polarization measures of income distribution in Brazil and their evolution from 1995 to 2013

Abstract

In this study the main measures of polarization in use are critically evaluated. Following this, polarization measures based on the Gini index or on Theil´s T inequality index, considering the division of the income distribution in two or three strata, are applied to data on per capita household income in Brazil, from 1995 to 2013. A clear tendency of decreasing income polarization is observed, similar to the reduction in inequality. Analyzing regional data, it is observed that the trend in income polarization is considerably different in the Federal District. Finally, explanations of the mistakes of papers with opposite results are presented.

Key words:
Polarization; Income distribution; Brazil - Inequality; Income strata

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