Download LorenzData.xlsx. It contains data from 336 micro-borrowers in Thailand, on this yearâs âIncomeâ and next yearâs âExpected Incomeâ. Graph two Lorenz curves, one for income and one for expected income, and turn in a single graph portraying both curves. According to the Lorenz criterion, is there more inequality in income or expected income? (Ignore the small regions where the curves cross.) Why might this be?

 

[HINT: Consider the income data. First, make sure to sort this column of data. Next, next to it create a column containing the cumulative sum of income â i.e. that has the sum of the first income in the first row, sum of the first two incomes in the second row, the sum of the first three incomes in the third row, etc. For cumulative sum, you can use something like a â=sum($A$2:A2)â command and then copy and paste to the next 335 rows, e.g., where the $-signs make sure the first cell in the summation does not change with the copy and paste. Next, next to that create a cumulative fraction of income column, which is the cumulative sum divided by the total sum of income. (You can use the same $X$n command to fix the total sum of income and use cut and paste.) Put an extra 0 at the top of this column to make sure it will start at 0. Finally, make a column that contains the fraction of borrowers included up to that point. You can do this by starting at 0 (on the same row that has the 0 in the cumulative fraction of income column) and adding 1/336 every row. Now, repeat the process for expected income. Then, graph the Lorenz curves. You can do this (in Excel 2013) by, for example, opening a second sheet and inserting a basic line chart (Insert, Line Chart, First Category). Then choose âSelect Dataâ.

You can then âAddâ the columns on the previous sheet that you want to graph in the âSeriesâ category (namely, income, expected income, and helpful also to graph fraction of the population, which gives a 45-degree line) and the column you would like to graph against (which is the fraction of the population) in the âHorizontal Axisâ category. You can edit the graph by clicking on it and using the Plus sign to the right to add various elements (e.g. title, axis labels, etc.) and/or clicking on text in the graph itself to edit.]

• 1493784366-LorenzData.xlsx

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Status NEW Posted 03 May 2017 04:05 AM My Price 7.00

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