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Computational Statistics & Data Analysis / Computational Statistics and Data Analysis 51, 7 (2007) 3368-3380
Estimation of income distribution and detection of subpopulations: an explanatory model
Emmanuel Flachaire 1, Olivier Nunez 2
(2007-04)

Empirical evidence, obtained from nonparametric estimation of the income distribution, exhibits strong heterogeneity in most populations of interest. It is common, therefore, to suspect that the population is composed of several homogeneous subpopulations. Such an assumption leads us to consider mixed income distributions whose components feature the distributions of the incomes of a particular homogeneous subpopulation. A model with mixing probabilities that are allowed to vary with exogenous individual variables that characterize each subpopulation is developed. This model simultaneously provides a flexible estimation of the income distribution, a breakdown into several subpopulations and an explanation of income heterogeneity.
1:  Centre d'économie de la Sorbonne (CES)
CNRS : UMR8174 – Université Paris I - Panthéon-Sorbonne
2:  Universidad Carlos III de Madrid
Universidad Carlos III de Madrid
Humanities and Social Sciences/Economies and finances

Statistics/Statistics Theory

Mathematics/Statistics
income distribution – mixture models
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