Concepts and Measurement of Inequality Flashcards
What is inequality?
Inequality refers to the uneven distribution of resources, wealth, or opportunities in a society.
What are the three main types of inequality?
Economic inequality, social inequality, and horizontal inequality.
Define economic inequality.
Disparities in income, wealth, and consumption levels among individuals or households.
What does social inequality refer to?
Uneven access to opportunities like education, healthcare, and employment.
Explain horizontal inequality.
Disparities between demographic or social groups, such as gender, race, or ethnicity.
What is the Gini Coefficient?
A measure of income inequality ranging from 0 (perfect equality) to 1 (perfect inequality).
How does the Lorenz Curve represent inequality?
It graphically shows the cumulative distribution of income or wealth.
What does the Palma Ratio compare?
The income share of the top 10% relative to the bottom 40%.
What is the Theil Index used for?
Measuring income inequality using an entropy-based approach.
How is the Coefficient of Variation used in inequality measurement?
It measures income dispersion as a statistical ratio.
How are poverty and inequality interconnected?
High inequality can lead to increased poverty by limiting resources and opportunities for the poor.
What is the difference between poverty and inequality?
Poverty measures the lack of minimum living standards, while inequality measures the distribution of resources.
What theory links income to individuals’ productivity?
Marginal Productivity Theory.
Which income distribution theory emphasizes class conflict?
Marxian Theory.
How does the Kuznets Hypothesis describe inequality trends?
It proposes an inverted U-shaped relationship between inequality and economic development.
