ESTIMATIONS OF INCOME DISTRIBUTION PARAMETERS FOR INDIVIDUAL OBSERVATIONS BY MAXIMUM LIKELIHOOD METHOD

This paper estimated the parameter values of several functional forms for income distributions and the Gini coefficients, using individual (ungrouped) observations by maximum likelihood estimator. An emphasis was placed upon comparing them with results based on grouped data estimated by minimum chi-square or MLE. It is preferable, in principle, to use individual observations based on a theoretical ground. When zero figures, however, of incomes are included, some functional forms cannot describe individual data properly. It is possible to obtain reasonable and robust estimates of parameters and Gini coefficients for these functional forms by using grouped data. Finally, some observations about the performances of the estimated functions and the Gini coefficients were discussed.