Suppose that at date 1 the distribution of income is (1, 2, 3), while later, at date 2, it is found to be (2, 3, 4). Ver

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answerhappygod
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Suppose that at date 1 the distribution of income is (1, 2, 3), while later, at date 2, it is found to be (2, 3, 4). Ver

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Suppose that at date 1 the distribution of income is (1, 2, 3),
while later, at date 2, it is found to be (2, 3, 4). Verify for
yourself that for a poverty line of 2 the reduction in the
headcount index of poverty is entirely due to growth in the mean,
i.e., that the redistribution component is zero. Now suppose the
distribution at date 2 is (1.5, 1.5, 3) (as in question 1). Is the
change in poverty now due entirely to redistribution? Discuss how
would your answer depends on what measure of poverty you use.
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