University of Texas at Austin

University of Texas Inequality Project

University of Texas at Austin
Lyndon B. Johnson School of Public Affairs


Beginner's Guide - Inequality Studies

The purpose of this series of documents is to introduce the reader to inequality studies, with an emphasis on Theil's T Statistic as a measure of wage and income inequality.

S No. Title Description
1 Measuring Inequality Non-technical introduction briefly describes inequality studies and reviews several leading inequality measures.
2 A Nearly Painless Guide to Computing Theil's T Statistic Brief example with an emphasis on constructing research questions and using a spreadsheet to conduct analysis
3 Using Theil's T Statistic: U.S. Income Inequality by County Extended example with an emphasis on data retrieval, data processing, and presentation.
4 The Theoretical Basics of Popular Inequality Measures This document explores several inequality measures used broadly in the literature, with a special emphasis on how to compute Theil's T statistic.

Technical Guide - Theil's T Statistic

More technical presentations that describe the use of Theil's T statistic to measure inequality in aggregated and hierarchical data sets.

S No. Title Description
1 The Mechanics and Logic of the Theil Statistic (Español) Includes the origins (Shannon's information measure), and the mathematical properties (decomposition) of the Theil Statistic.
2 Mechanics to Calculate the Theil and use of Programs and Macros (Español) Includes data discussion and a guide to calculate the between-groups and within-groups component, and the total Theil's T-statistic in excel.