What does "Gini Coefficient" mean?
Table of Contents
The Gini coefficient is a number that measures income inequality in a group of people, like a country or a city. It helps show how wealth is distributed among individuals.
How It Works
The Gini coefficient ranges from 0 to 1. A score of 0 means everyone has the same income, which indicates perfect equality. A score of 1 means all the wealth goes to one person, showing complete inequality.
Importance
This measurement is useful for understanding social and economic conditions. It gives insights into how different industries and sectors contribute to income differences. By looking at the Gini coefficient, we can gauge how various factors influence wealth distribution in society.
Applications
The Gini coefficient is often used by researchers and policymakers to evaluate economic health and guide decisions. It helps people understand if wealth is shared fairly or if there are significant gaps between rich and poor.