Economics • Income Distribution

Lorenz Curve & Gini Coefficient

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GDP is in the country's own currency. Change the figures to make your own scenario.

Lorenz curve

Gini coefficient 0.33
0% 20% 40% 60% 80% 100% 0% 20% 40% 60% 80% 100% Line of perfect equality Cumulative share of population, poorest first Cumulative share of income

A: the gap from equality B: income held. Gini = A ÷ (A + B).

Average income in each decile

Each 10% of the population, poorest at the top: its share of income, and that share of GDP per person.

Poorest → richest Scale: 0–100% Equal share (10%)

Where the figures come from

GDP and the exchange rate are World Bank figures; population is from each country's own statistics agency; the Gini coefficient is the World Bank's where it publishes one, otherwise the national statistics agency's or the OECD's. US-dollar amounts use today's European Central Bank reference rate when it can be fetched, otherwise the World Bank's annual rate (always, for the rouble, which the ECB no longer publishes).

Lorenz Curve & Gini Coefficient — Explanation

A Lorenz curve shows how a country's income is shared out. Line everyone up from the poorest to the richest: the curve plots the share of all income (up the side) held by the poorest so many per cent of people (along the bottom).

Use a Lorenz curve and the Gini coefficient to describe and compare income inequality.

Choose a country to load its GDP, population and Gini coefficient (the sources are under Sources), or type your own figures in and drag the Gini slider. Switch between the country's own currency and US dollars in the title bar.

A simplification: a country's Gini coefficient is measured on household (usually disposable) income, which is less than GDP, so the averages here are each decile's share of GDP per person rather than what people actually take home. For Cambridge International AS & A Level Economics and NCEA Level 2 and 3 Economics.

Where this fits

  • AP: AP Microeconomics
  • AQA: AQA A Level Economics (7136)
  • Cambridge: Cambridge A Level Economics (9708); Cambridge AS Level Economics (9708) Goes beyond Cambridge AS Level Economics (9708): AS needs the Gini only as a measure (no calculation); the Lorenz curve and A ÷ (A + B) are A Level (11.4.2).
  • IB: IB Economics HL; IB Economics SL
  • NCEA Level 2 Economics: 91228 Analyse a contemporary economic issue of special interest using economic concepts and models
  • NCEA Level 3 Economics: 91402 Demonstrate understanding of government interventions where the market fails to deliver efficient or equitable outcomes
  • Pearson Edexcel International: Edexcel International A Level Economics
  • USDP: USDP Economics

Lorenz Curve & Gini Coefficient — Key Terms

Key concepts in English, with te reo Māori, Chinese (Simplified) and Korean.

EnglishTe reo Māori中文（简体）한국어What it means on this page
Lorenz Curveno attested term洛伦兹曲线 (Luòlúnzī qūxiàn)로렌츠 곡선 (Rorencheu gokseon)A curve plotting the cumulative share of total income (y-axis) received by the cumulative share of the population (x-axis), ranked from poorest to richest.
Gini Coefficientno attested term基尼系数 (Jīní xìshù)지니 계수 (Jini gyesu)A single number between 0 and 1 measuring income inequality: the area between the Lorenz curve and the line of perfect equality (Area A), divided by the total area under the line of perfect equality (Area A + B).
Line of Perfect Equalityno attested term绝对平等线 (Juéduì píngděng xiàn)완전 균등선 (Wanjeon gyundeungseon)The 45° diagonal on a Lorenz diagram, showing what perfectly equal income distribution would look like — every 20% of the population holding exactly 20% of income.
Income Decileno attested term收入十分位数 (Shōurù shífēnwèi shù)소득 10분위 (Sodeuk sipbunwi)One of ten equal-sized 10% groups the population is divided into when ranked by income, from the poorest decile to the richest.
Perfect Equalityno attested term完全平等 (Wánquán píngděng)완전 평등 (Wanjeon pyeongdeung)A theoretical situation (Gini = 0) where every individual or household receives an identical share of total income.
Perfect Inequalityno attested term完全不平等 (Wánquán bù píngděng)완전 불평등 (Wanjeon bulpyeongdeung)A theoretical situation (Gini = 1) where a single individual or household receives all of the economy's income and everyone else receives none.
Income Inequalityno attested term收入不平等 (Shōurù bù píngděng)소득 불평등 (Sodeuk bulpyeongdeung)The extent to which income is distributed unevenly across a population, commonly measured using the Gini coefficient or Lorenz curve.

On the te reo Māori column. Terms marked as gaps have no attested equivalent in the sources checked — Karaitiana Taiuru's Dictionary of Māori Computer and Social Media Terms, Paekupu, the Reserve Bank's te reo financial glossary, NZQA and Te Aka. No coinage is printed as though it were established; where a class needs one, commission it from Te Taura Whiri i te Reo Māori and credit the translator. Te reo Māori is not italicised and takes no plural "s".