Abstract
This paper attempts to clarify the debate over trends in inequality in Indonesia from 1969 to 1981, by adjusting die standard inequality measures for the differential impact of inflation on different expenditure groups. It is shown that, once such adjustment is made, inequality increased in Indonesia between 1969/70 and 1976, but declined between 1976 and 1981. Adjustments are also made to the inequality indicators for urban and rural areas, and for Java and the Outer Islands.

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