The Measurement of Income Inequality: The Subjective Approach

The research on the theory of income inequality measurement began towards the end of the nineteenth and the beginning of the twentieth century. Most of that early research discussed statistical tools of measurement. One of the exceptions was the work of (1920) who discussed measurement from a social welfare point of view. The subjective approach, which is the subject of this chapter, is in fact related to this social welfare approach as is most of the more recent research on the measurement of income inequality, which began more than 25 years ago (see Atkinson 1970; Kolm, 1969; Sen, 1973).