Distributive indices and statistical inference



By distributive indices, we mean indices that quantify poverty,  inequality, etc.

Statistical inference enables us to:

  • Estimate the confidence interval of an index.
    • When the confidence interval is narrow, the precision of the estimate is high.
  • Test a null hypothesis.
    • For instance, we may want to test if a variation in poverty or inequality is positive.

To do statistical inference, we need to:

  • Estimate the value of an index
  • Determine the sampling distribution and the standard error of the estimator of the index. The sampling distribution can usually be shown to be asymptotically normal.

Besides the asymptotic distribution, we can also use simulation methods, such as the bootstrap.




  DAD Application

The free software DAD developed by our research center can help you to perform statistical inference:


  • For the applications Poverty|FGT index, Inequality|Akinson or Gini index, press the SD STD button.

  • For the other applications, also use the application Distribution|Confidence Interval


  1anidot5a.gif Exercise