The problem of income distribution can be viewed
in both absolute and relative terms. In relative terms,
income inequality is primarily concerned with the
income position of individuals or households in
relation to each other. Changes in income inequality
indicate how the benefits of economic growth are
distributed among individuals and households.
Changes in inequality are socially subjective, however,
and are tolerable as long as the process of
change involves Pareto improvement - absolute
gains for all - and does not preclude future and more
desirable distributional changes (Adelman and
Robinson, 1989). Poverty incidence is primarily
concerned with the minimum level of income needed
to maintain a given standard of living. Results of
recent research indicate that poverty and malnutrition
are positively correlated (Biswas and PinstrupAnderson,
1985). Increases in poverty incidence
incur hardship. When income becomes so low that
people cannot survive or maintain normal activity,
their poverty indirectly creates problems for those
who are not poor, and becomes a cost to the whole
community in terms of crime, medical problems, etc.
There has been increasing concern with the problem
of income distribution in Thailand. In the seventh
development plan (1 992- 1996), the Thai government
has given priority to the problem, by focusing on
the reduction of poverty and an increase in income of
the targetted groups, particularly poor farmers and
farm workers.
This paper examines the size distribution of
income in Thailand, which explains how income is
divided among households or individuals. Based on a
minimum level of income (poverty line), the size
distribution of income can also explain the proportion
of poor in the total population, and the extent of
poverty in Thailand. The focus on income distribution
arises from the increasing concern that rapid
economic growth and structural change in the Thai
economy did not sufficiently reduce poverty and
income inequality. Large proportions of the Thai
population were not benefiting from the growth.