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TABLE 13-3 Simulated Effects of the Informal Economy on Hungarian Incomesa in 1992

Atkinson Decile Pointsb
Estimate Gini e = 1c e = 2 P10 P90 Decile Ratiod
Reported equivalent
disposable incomea
.282 .133 .272 54.4 182.6 3.37
Simulated equivalent
disposable income
from informal
economy = 15 percente
.276 .118 .210 65.8 207.5 3.15
Simulated equivalent
disposable income
from informal
economy = 25 percentf
.274 .115 .196 72.5 222.0 3.06

a All income measures use 1.00, .67, .33 equivalence scale and person weights.

bThe decile points are the ratio of the 10th percentile person's income to the median (P10), multiplied by 100, and the 90th percentile person's income (P90) to the median, multiplied by 100.

cThe parameter e represents the weight attached by society to inequality in the income distribution (see text).

dThe decile ratio is the ratio of P90 to P10.

eAssumes income from the informal economy is 15 percent of total disposable income; see text for simulation details.

fAssumes income from the informal economy is 25 percent of total disposable income; see text for simulation details.