Lorenz curve (add to wealth and income) Flashcards
1
Q
Lorenz curve
A
A Lorenz curve shows the % of income earned by a given % of the population. A ‘perfect’ income distribution would be one where each % received the same % of income, for example, where 60% of the population gain 60% of national income. The further the Lorenz curve is from the 45 degree line, the less equal is the distribution of income.
2
Q
changes in the Lorenz curve
A
Changes in the position of the Lorenze curve indicates changes in the distribution of income. In this example, the curve for 2010 is further away from the line of equal distribution than the curve in 1990, implying a wider distribution of income.
