DECOMPOSING LORENZ AND CONCENTRATION CURVES* JOHN A. B ISHOP Department of Economics East Carolina University bishopj@mail.ecu.edu K. VICTOR CHOW Department of Finance West Virginia University vchow@mail.wvu.edu LESTER A. ZEAGER Department of Economics East Carolina University zeagerl@mail.ecu.edu ABSTRACT: We decompose the Lorenz curve and its associated concentration curve by population subgroups. To illustrate these decompositions, we examine changes in earnings inequality among West Germans, East Germans, and foreign guest workers during the recent German unification. We show that East German earnings have become less concentrated in the lower deciles of the overall German earnings distribution, while the earnings of West Germans and foreign guest workers have become more concentrated in the lower deciles. * The authors would like to thank two anonymous referees for their helpful comments. April 5, 2002