Multidimensional Quantitative Indicators

It is widely accepted that attributes other than income, matter for individual welfare. Non-income dimensions of well-being contribute significantly to the quality of life, and it is important to assess both deprivation in these different dimensions of well-being and inequality in their distribution. Multidimensional inequality indices summarize the degree of inequality in the multivariate distribution of dimensions into a single number and provide a unique ranking that allows for comparison of different distributions across time or populations. A large body of literature proposes multidimensional inequality indices that satisfy some optimal properties as in the case of the one-dimensional inequality index. However, the extension to the multidimensional case is not straightforward, and new challenges arise in the development of multidimensional indices regarding how to aggregate the well-being attainments, across both individuals and dimensions. Different measures of inequality have been proposed depending on the choice of the sequence of aggregations (individuals and dimensions), the degree of association or substitutability between dimensions, the importance assigned to each dimension, and the degree of aversion to inequality in the social evaluation function. In this review, due to space constraints, we consider multidimensional inequality indices for ratio-scale variables, which constitute the focus of most of the literature on multidimensional inequality measurement.