Investigating the Income Status of Isfahan Province Using a Parametric Approach: 2011-2021

Abstract

The purpose of this article is to investigate the distribution of household income in Isfahan province by using the data of the household income and expenditure plan, for the period of 2011-2021 using parametric methods. For this purpose, different statistical distributions are fitted to the data, and distribution parameters are estimated using the maximum likelihood estimation method. Then, the appropriate distribution is selected using distribution function graphs and Akaike's criterion (AIC). By comparing the graphs of distribution functions from 2011 to 2021 for the data, the results show that among all the distributions, the Dagum and Gamma distributions are more suitable than other distributions, including log-normal and exponential distributions. Also, the amount of AIC from 2011 to 2021 for the Dagum distribution takes the lowest values compared to other distributions, which also shows the superiority of the Dagum distribution over other distributions. Also, the investigation of the trend and comparison of Gini coefficients in non-parametric and parametric modes indicates that along with the decreasing trend of the Gini coefficient in Isfahan province during the period under review, the values of the Gini coefficient in the parametric method based on the Kolmogorov-Smirnov statistic are more reliable. Therefore, it is suggested that those responsible for producing the income inequality index change their calculation basis from the non-parametric method to the parametric method, considering the high accuracy of the parametric methods.

Keywords

• income distribution
• gini coefficient
• gamma distribution
• dagum distribution
• aic criterion