Sunday, April 01, 2007

Gini coefficient

What is a Gini coefficient?

According to wikipedia(and all your standard macroeconomics textbook), a Gini coefficient is
.........a measure of inequality of a distribution. It is defined as a ratio with values between 0 and 1. [Source: Wikipedia]
To cut a story short, take it that having a Gini coefficient of 0 is ideal, meaning everybody's income in the country is perfectly equal, while having a Gini coefficient of 1 means that all the wealth in the country is controlled by just a single person. So, 0 to 1 means from good to bad.

Now let's take a look at the CIA factbook,

Malaysia - 46.1 (2002)

Not too bad? Let's compare to some of the countries we know that has problems with this area:

Malaysia - 46.1 (2002)
Malaysia - 49.2 (1997)
Indonesia - 38.4 (2004)
China - 44 (2002)
Cambodia - 40 (2004 est.)
Thailand - 51.1 (2002)
United States - 45 (2004)

Certainly we see an improvement from 1997-2002, we had our last general election in 2003, so anybody know of when the latest survey will be carried out? Have we improved? I certainly hope so.

By the way, the figures above are in percentages, so it's still between 0 and 1.

  1. Distribution of family income - Gini Index, CIA- The World Factbook.
  2. Gini coefficient, Wikipedia.

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