Health, Wealth and Wisdom: Exploring Multidimensional Inequality in a Developing Country

Despite a broad theoretical literature on multidimensional inequality and a widespread belief that welfare is not synonymous to income—not the least in a developing context—empirical inequality examinations rarely includes several welfare attributes. We explore three techniques on how to evaluate multidimensional inequality using Zambian household data on consumption, education, health and land. The examination indicates that level and changes in non-monetary inequality are at odds with consumption inequality. Moreover, assessment of a multidimensional index shows evidence of that dimensions of wellbeing compensate and reinforce each other with respect to inequality. However, a majority of the results using this technique are sensitive to the degree of substitution between attributes. In applying a stochastic dominance method few combinations fulfill the required dominance conditions. Accordingly, less imposed structure come at a cost. Clearly, sensitivity analyzes, explicitness and analyzes involving more than one technique are constructive in portraying multidimensional inequality.