Measuring Social Tension from Income Class Segregation

Yoonseok Lee, Donggyun Shin

Research output: Contribution to journalArticle

1 Scopus citations

Abstract

We develop an index that effectively measures the level of social tension generated by income class segregation. We adopt the basic concepts of between-group difference (or alienation) and within-group similarity (or identification) from the income [bi]polarization literature; but we allow for asymmetric degrees of between-group antagonism in the alienation function, and construct a more effective identification function using both the relative degree of within-group clustering and the group size. To facilitate statistical inference, we derive the asymptotic distribution of the proposed measure using results from U-statistics. As the new measure is general enough to include existing income polarization indices as well as the Gini index as special cases, the asymptotic result can be readily applied to these popular indices. Evidence from the Panel Study of Income Dynamics data suggests that, while the level of social tension shows an upward trend over the sample period of 1981 to 2005, government’s taxes and transfers have been effective in reducing the level of social tension significantly.

Original languageEnglish (US)
Pages (from-to)457-471
Number of pages15
JournalJournal of Business and Economic Statistics
Volume34
Issue number3
DOIs
StatePublished - Jul 2 2016

Keywords

  • Asymmetric antagonism
  • Income polarization
  • Relative clustering
  • Social tension
  • U-statistics

ASJC Scopus subject areas

  • Statistics and Probability
  • Social Sciences (miscellaneous)
  • Economics and Econometrics
  • Statistics, Probability and Uncertainty

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