Measurement of Income Inequality in Iran, 1984-2010

Inequality measurement in a time horizon، using different inequality indices while coupled with the corresponding poverty indices، provide a better understanding of income distribution and hence an appropriate time series data for policy makers in a country. Once high inequality is coincident with chronic and grinding poverty becomes a source of threat for social stability and concerns for policymakers. The main purpose of this study is to measure income inequality for different provinces and regions of Iran from 1984 till 2010. Then inequality is disintegrated into within and between regions inequalities in different provinces and regions. To this end، data from Iran Household Survey is used and processed by an equivalence scale method. Then، inequality based on Gini Coefficient، Atkinsom measure، and Theil statistic is estimated for the provinces and regions. Since duality is one of the basic features of the developing countries، in order to address this problem، trends of inequality measures in rural and urban areas are defined. Findings of the study have shown that inequality was declining till 2005 then it was increasing until 2009 then it declined again in 2010. The highest inequality is registered for Golestan and Sistan va Baloochestan and khorasan Razavi and Markazi Provinces. The highest urban measure، in terms of nine-region country، is for south-Eastern and north-east region. Within group inequality defines overwhelming weight of inequality during the period which implies redistribution policies compatible with the characteristics of each region could be more effective method of narrowing down regional inequalities.