Definition of Lorenz curve
The Lorenz curve is a graphical representation of income distribution within a given population. It plots the cumulative percentage of total income received by the population against the cumulative percentage of the population. This curve is widely used in economics and social sciences to measure inequality. The closer the Lorenz curve is to the line of absolute equality, the more equal the income distribution. On the other hand, a more bowed-out curve suggests greater income inequality. By analyzing the shape and position of the Lorenz curve, policymakers and researchers can better understand the level of inequality present in a society, aiding in the formulation of effective policies to address it.
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Definition of Atkinson index
The Atkinson index is an economic indicator used to measure income inequality within a population. It provides insights into the concentration of income and the distribution of wealth by taking into account both the number of individuals and the inequality of their income distribution. The index ranges from 0 to 1, with a value of 0 indicating perfect equality and a value of 1 indicating maximum inequality. By calculating the Atkinson index, policymakers and economists can assess the impact of various socio-economic policies on income distribution and make informed decisions to address inequality and promote equitable growth.
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Definition of income inequality
Income inequality refers to the unequal distribution of income among individuals or households within a particular society or country. It is a concept that highlights the disparities in the earnings and wealth possessed by people, indicating the extent to which income is concentrated or spread across different segments of a population. This disparity can be measured through various indicators such as the Gini coefficient or the percentage share of income held by different socioeconomic groups. Income inequality can have significant socioeconomic implications, influencing social mobility, access to resources, and overall economic stability. It is a matter of concern for policymakers and economists, as addressing income inequality is crucial for fostering inclusive growth and reducing poverty.
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Definition and types of income inequality
Income inequality refers to the unequal distribution of income within a society or between different groups of people. It is a concept that highlights the disparities in income levels and the concentration of wealth among individuals or households. There are various types of income inequality that can be observed globally, such as vertical inequality, which refers to the differences in income between individuals or households; horizontal inequality, which refers to the disparities based on social characteristics like gender, race, or ethnicity; and spatial inequality, which refers to the regional or geographical variation in income levels. These types of income inequality play a significant role in shaping social and economic dynamics within societies.
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