Horizontal and Vertical Inequality: Some Interconnections and Indicators

This note is concerned with presenting some simple indices of group-wise relative disadvantage in the distribution of income, in terms of the distance between the group's share in total population and its share in total income. The group-wise indices are then aggregated into society-wide indices of inter-group disparity. Empirical illustrations of the note's measurement concerns are provided, using data on the global distribution of income. The measures of horizontal inequality are shown to lead to corresponding measures of vertical inequality, in the special case in which the grouping resorted to is 'individualistic'.