Income Inequality
B. Inequalities measure and state of the art
B.1 Inequalities types and measurement
Usually inequality refers to economic inequality that is either: income inequality, the distribution of income among a group, or wealth inequality, the difference (or the distribution) of quantity of money and valuable possessions.
But it can also refer to education inequality, that is the difference in ease to a quality education, or healthcare inequality, that is the difference of difficulty in access to healthcare services.
Economic inequality will be the focus here and more specifically the effect of this example of helicopter drop on income inequality, the amount of cash payment was too small to have had a measurable impact on wealth inequality.
A number
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Once this data is obtained, the Gini index can be computed through the formula:
where the x series corresponds to the reported incomes.
(the formula can be changed to include weight in order to take into account misrepresentation of the collected data)
B.2 Inequality over time and over the globe
Surveys have only been implemented worldwide recently (since roughly thirty years), some researchers (such as Piketty and Milanovic) have however developed database history tracking inequality along the ages.
Figure 4 : Estimated Global Gini Coefficient
(Source Milanovic 2005, Maddison 2007)
By retracing and estimating the global inequality of the world since the 19th century, Milanovic has shown that inequality progressively evolved from what he calls class inequality, to locational inequality (Milanovic, 2005).
Before the industrial revolution, inequality originated mainly from the difference of income inside countries. Since the industrial revolution, western countries’ standard of living has evolved a lot (and tend to keep evolving) while other countries have beneficiated from this development only recently through
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