Research Paper No. 751

BAYESIAN ESTIMATION OF SOCIAL WELFARE AND TAX PROGESSIVITY MEASURES

BY

DUANGKAMON CHOTIKAPANICH & JOHN CREEDY

JUNE 2000

Department of Economics. University of Melbourne. Melbourne Victoria 3010 Australia

 

Contents

1. Introduction

2. Summary Measures

3. Computation of Alternative Measures

4. Posterior Densities

    1. Posterior Density For pi
    2. Information about ui
    3. Lognormal Distribution of Pre-tax Income
    4. Assumptions About Group Mean Income

5. Numerical Results

    1. Grouping of Pre-tax Incomes
    2. The Summary Measures

6. Conclusions

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