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Measuring Inequality;in·equal·i·ty Function: noun1 : the quality of being unequal or uneven: as a : lack of evenness b : social disparity c : disparity of distribution or opportunity d : the condition of being variable : changeableness 2 : an instance of being unequal;Our primary interest is in economic inequality. In this context, inequality measures the disparity between a percentage of population and the percentage of resources (such as income) received by that population. Inequality increases as the disparity increases. ;If a single person holds all of a given resource, inequality is at a maximum. If all persons hold the same percentage of a resource, inequality is at a minimum. Inequality studies explore the levels of resource disparity and their practical and political implications.;Physical attributes – distribution of natural ability is not equal Personal Preferences – Relative valuation of leisure and work effort differs Social Process – Pressure to work or not to work varies across particular fields or disciplines Public Policy – tax, labor, education, and other policies affect the distribution of resources;Why measure Inequality?;How do we measure Inequality? ;Choosing the best metric;Range;Range;Range Ratio;Range Ratio;The McLoone Index;The McLoone Index;The Coefficient of Variation;The Coefficient of Variation;The Gini Coefficient;A – Equality Diagonal Population = Income B – Lorenz Curve C – Difference Between Equality and Reality ;The Gini Coefficient;The Gini Coefficient;Theil’s T Statistic;Theil’s T Statistic;Theil’s T Statistic;Theil’s T Statistic;Theil’s T Statistic – Example 1;Theil’s T Statistic;Theil’s T Statistic;Theil’s T Statistic;Theil’s T Statistic – Example 2;Group analysis with Theil’s T Statistic:;Theil’s T Statistic;Next Steps
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