Measuring global well-being inequality: A dimension-by-dimension or multidimensional approach?

This paper investigates the evolution of global well-being inequality between 1980 and 2010 based on three dimensions: income, health and education. I compare two different approaches to the measurement of global well-being inequality: a dimension-by-dimension approach and a multidimensional one. The first approach analyses the dimensions of well-being separately. The inequality of each of these dimensions shows a remarkably different pattern over time. Unfortunately, this dimension-by-dimension approach is insensitive to the correlation between the dimensions of well-being. The second approach takes this correlation into account and starts from a multidimensional measure of well-being for each country. This well-being measure reflects the implicit value judgments of the revised Human Development Index (HDI). It is shown that multidimensional well-being inequality has decreased over the considered period. However, this result depends crucially on the weighting scheme selected, the aggregation procedure and the transformation of the income dimension. Biographic note: I wrote my doctoral dissertation on ?Essays on the measurement of multidimensional inequality?. Financial support from the IWT-project: ?Flemosi: Tools for ex ante evaluation of socio-economic policies in Flanders? is gratefully acknowledged. JEL Classification: D63, I31, O52.