DEFINITION
Gini index measures the extent to which the distribution of income (or, in some cases, consumption expenditure) among individuals or households within an economy deviates from a perfectly equal distribution. A Lorenz curve plots the cumulative percentages of total income received against the cumulative number of recipients, starting with the poorest individual or household. The 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. Thus a Gini index of 0 represents perfect equality, while an index of 100 implies perfect inequality.
DEFINITION: Gini index measures the extent to which the distribution of income (or, in some cases, consumption expenditure) among individuals or households within an economy deviates from a perfectly equal distribution. A Lorenz curve plots the cumulative percentages of total income received against the cumulative number of recipients, starting with the poorest individual or household. The 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. Thus a Gini index of 0 represents perfect equality, while an index of 100 implies perfect inequality.
The U.S. ranks at #72 in inequality of distribution of income. This is not wealth distribution, but income. The U.S. gini for wealth is much higher, that is unequal. No developed country ranks below the U.S., is more unequal, in income distribution. Professor Emmanuel Saez of U.C. Berkeley has an informative report on inequality of income, "Striking It Richer" updated August, 2009. He states that for 2007 the top one percent of households received 23.5% of the national income, an amount greater than the bottom 60% of households. The top ten percent received 49.7%, while from 1940 to 1982 the top ten percent never received more than 35%.
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