Distribution of family income gini index measures the degree of inequality in the distribution of family income in a country. Poverty, inequality, and conflict in developing countries. Income inequality among individuals is measured here by five indicators. The more unequal a countrys income distribution, the higher its gini index, e. Data are based on primary household survey data obtained from government statistical agencies and world bank country departments. According to world banks poverty and shared prosperity 2016 report, the gini coefficient saw a sustained growth during the 19th and 20th centuries. A comparison of the gini and atkinson measures of inequality. But a large part of the debate focuses on income inequality within countries, in particular within advanced economies. Accordingly, policymakers and citizens alike would benefit from having an alternative, or at least complementary. Pieter, but im concerned that youre attributing too much normative content should to the gini coefficient, which is really just a descriptive measure.
As many countries have experienced and the inclusive development index data illustrate, growth is a necessary but not sufficient condition for robustly rising median living standards. The gini index is a summary statistic that measures how equitably a resource is distributed in a population. The least developed countries ldcs in the world have hdi scores in the low human development tiers with hdi scores below 0. Gini index of global income inequality global inequality according to concept 3 requires data for the distribution of income between households within countries that is available starting only from the mid1980s. Of course, a global overview masks variations over time and between countries. Of the major developed and emerging economies in 2017, brazil was the most unequal with the a gini index score of 53. America saw a sizable decline in the gini index in the 2000s. Gini index world bank estimate colombia world bank, development research group. It is used as a gauge of economic inequality, measuring income distribution among a population. A range of alternatives to the gini exist, which give different weight to dynamics across different parts of the income distribution. Changing income inequality by gini coefficients may be down to things such as structural changes or immigration. Thus a gini index of 0 represents perfect equality, while an index of 100 implies perfect inequality.
The gini was developed by the italian statistician corrado gini in 1912, for the purpose of rating countries by income distribution. Gini index, a quantified representation of a nations lorenz curve. It looks at the distribution of a nations income or wealth, where 0 represents complete equality and 100 total. Ldcs face unstable governments, widespread poverty, lack of access to healthcare, and poor education. Feb, 2020 this statistic represents the 20 countries with the greatest income distribution equality between 2010 and 2017 based on the gini index. The index is based on the gini coefficient, a statistical dispersion measurement that ranks income distribution on a scale between 0 and 1. The effect of fdi, exports and gdp on income inequality in. Of the major developed and emerging economies in 2015, brazil was the most unequal with the a gini index score of 51. Inside inequality in the arab republic of egypt facts and perceptions across people, time, and space. We read every letter, fax, or email we receive, and we will convey your comments to cia officials outside opa as appropriate. It looks at the distribution of a nations income or wealth, where 0 represents complete. The more nearly equal a countrys income distribution, the lower its gini index, e. Corrado gini developed the gini coefficient in his 1912 paper variability and mutability to express a distributions difference from uniformity.
Additionally, these countries have low income and low life expectancies coupled with high birth rates. Therefore, when a gini coefficient of a developing country rises, this could be misleading. Gini index in developed and emerging economies 2017 statista. A gini index of 0% expresses perfect equality, while index of 100% expresses maximal inequality. It is often used as a gauge of economic inequality, measuring income distribution or, less commonly, wealth distribution among a population. The united states, for example, is widely seen as the country. Learn how the world bank group is helping countries with covid19 coronavirus. It discusses its characteristics and the link with another popular graphical tool of representing inequality, the lorenz curve. The countries with the highest gini coefficients are. Gini coefficient in oecd countries between 1980s and late 2000s. You may be most familiar with the gini index as a way of measuring income inequality across nations. This is a list of countries or dependencies by income inequality metrics, including gini coefficients.
In contrast, nordic countries in europesuch as finland and swedenhave a similar income per capita as that in the u. The measure has been in use since its development by. Although it has its critics, the most widely used inequality measure remains the gini index, a synthetic measure of income or consumption inequality across the entire distribution. The inclusive development index 2018 summary and data. Courtesy of the census bureau, it is now available for policymap users at various geography levels from nation to census tract. Using a panel for 32 developed countries spanning the last four decades, our results indicate that the predictions of the stolpersamuelson theorem concerning the effects of international trade on income inequality find support in the data if we concentrate on imports from developing countries as a trade measure, as theory would imply. Using the gini index we have to consider numerous disadvantages and problems. South africa is the top country by gini index in the world. Gini index world bank estimate from the world bank. In addition to a selfcontained presentation of the gini. Human development report 2016 human development for everyone the 2016 human development report is the latest in the series of global human development reports published by the united nations development programme undp since 1990 as independent, analytically and empirically. Gini coefficient measures the inequality of wealth distribution or income inequality in a particular area. Finally, the lorenz curve and the gini index are also used when one is interested in diversity, for instance the diversity of journals shown in a reference list.
Gini index measures the extent to which the distribution of income or consumption expenditure among individuals or households within an economy deviates from a perfectly equal distribution. Results the gini index, as the other measure of income inequality, was negatively associated with life expectancy p gini index measures the area between the lorenz curve and a hypothetical line of absolute equality, expressed as a percentage of the maximum area under the line. The office of public affairs opa is the single point of contact for all inquiries about the central intelligence agency cia. Global, inter country, and within countries zia qureshi 1 over the last three decades, inequality between countries has decreased while inequality within. Inequality may be broken down by population groups or income sources or in other dimensions. The top 5 countries also includes namibia, sri lanka, china, and zambia. Many emerging countries, especially china, have caught up with the developed world in the course of globalisation. The gini coefficient increased by 24 per cent in china, 16 per cent in india, and 4.
Including the value of governmentprovided health and education benefits makes the united states look even more unequal compared to other developed countries. While most developed european nations tend to have gini coefficients between 0. In 1912, italian sociologist and statistician corrado gini developed a means of measuring wealth distribution within societies known as the gini index or gini coefficient. Why is income inequality increasing in the developed world. The minimum gini index 0 would mean that the income is even distributed among all countries. This statistic shows the 20 countries with the biggest inequality in income distribution in 2017 based on the gini index. The gini coefficient is based on the comparison of cumulative proportions of the population against cumulative proportions of income they receive, and it ranges between 0 in the case of perfect equality and 1 in the case of perfect inequality. Cia data from the central intelligence agencys the world factbook. Global, intercountry, and within countries zia qureshi 1 over the last three decades, inequality between countries has decreased while inequality within. Income inequality and limitations of the gini index.
The gini index or gini coefficient is a statistical measure of distribution developed by the italian statistician corrado gini in 1912. Nov 14, 2014 using a panel for 32 developed countries spanning the last four decades, our results indicate that the predictions of the stolpersamuelson theorem concerning the effects of international trade on income inequality find support in the data if we concentrate on imports from developing countries as a trade measure, as theory would imply. For example, the gini index a measure of the extent to which of income among individuals or. You seem to be under the impression that somebody is advocating that. Gini index world bank estimate world bank, development research group. Which question would most likely be studied using the gini index. Human development report 2019 human development reports.
There have been rapid improvements in the past few. The gini coefficient is based on the comparison of cumulative proportions of the population against cumulative proportions of income they receive, and it ranges between 0 in the case of perfect equality and 1. Also then the gini index can be used, but as diversity is seen as the opposite notion of inequality, the gini diversity index is calculated as one minus the gini inequality index. Inequality as measured by the gini and polarization do not necessarily move together. The gini coefficient, a standard measure of income inequality that ranges from 0 when everybody has identical incomes to 1 when all income goes to only one. A global perspective prepared by era dablanorris, kalpana kochhar, frantisek ricka, nujin suphaphiphat, and evridiki tsounta with contributions from preya sharma and veronique salins1 authorized for distribution by siddharh tiwari june 2015 jel classification numbers. Focusing on developed countries, i present a model explaining how firms help determine rates of. Summary this tool addresses the most popular inequality index, the gini index. Gini index of household income inequality by development status early 1990s. While most developed european nations tend to have gini coefficients between. Impact of income inequality on life expectancy in a highly.
Mar 06, 2019 the gini index or gini coefficient is a statistical measure of distribution which was developed by the italian statistician corrado gini in 1912. Inclusive development index weforum world economic forum. As can be seen, the gini index of global income inequality. Education gini could be used as one of the indicators of welfare, complementing average education attainment, health and nutrition, income per capita, and other indicators of welfare. Among the brics countries of brazil, russia, india, china and south africa, south africa has the highest income inequality index, a gini index of 0. How valid is international comparisons of the gini index. Gini index income distribution equality country ranking. Even in asia, where aggregate inequality has been on the rise, there are nonetheless a few countries where inequality is defying the regional trend. Ranks 23rd out of 30 developed countries for inequality a comprehensive index from the world economic forum finds that for such a rich country, america isnt doing all. The gini index is not easily decomposable or additive across groups. Preliminary empirical analysis finds that, first, education inequality for most of the countries has been declining during the three decades, with a few exceptions. To benchmark and monitor income inequality and poverty across countries, the oecd relies on a dedicated statistical database. The gini coefficient, a standard measure of income inequality that ranges from 0 when everybody has identical incomes to 1 when all income goes to only one person, stood at an average of 0.
An overview of growing income inequalities in oecd countries. The gini index is the most widely used measure of inequality see map above. The gini coefficient measures relative and not absolute wealth. Based on countries for which an inequalityadjusted human development index value is calculated. According to world banks poverty and shared prosperity 2016 report, the. The gini coefficient is a number between 0 and 1, where 0 corresponds with perfect equality where everyone has the same income and 1 corresponds with perfect inequality where one person has all the incomeand everyone else has no income. The inclusive development index 2018 summary and data highlights. All of the nine advanced economies that are members of the g20, made up of leading developed and developing nations, saw the gini coefficient the most. While a perfect scenario would be that of equality in income distribution, this is not normally the case in most of the areas around the world. Finally, in 1914 he developed the w ellknown index of.
Inequality within countries has been rising at different speeds but almost across the board among. Gini index in key developed and emerging economies in 2015. Gini coefficient and lorenz curve explained towards data. For example, using wage in come to assess inequality in sweden in 1976 resulted in a gini index of 43. The gini index is a measure of a country s income inequality. The country show in the pie graph is probably a about 45 tertiary, 15 secondary, a small sliver primary. Gini coefficients of education world bank documents. The most equal country in this group was germany, with a gini index of 31. Finance statistics manual gfsm 2001 system are debt, except for. Gini index inequality of income distribution country. Inequalities at national level are increasing in developed and developing countries. That is, the total gini of society is not equal to the sum of the gini coefficients of its subgroups.