1. The Gini coefficient is often used to measure inequality. The Lorenz curve The shaded region Sis called a concentration area The Gini coefficient equals two concentration areas, i.e., G= 2S. When the value of the Gini coefficient is close to 0, the underlying distribution is almost uniform, whereas the value close to 1 indicates a maximal inequality, i.e., a total wealth of a population is concentrated in hands of one man. When the Lorenz curve of income distribution within a certain group is given by L (x), show the formula which computes the Gini coefficient.

# 1. The Gini coefficient is often used to measure inequality. The Lorenz curve The shaded region Sis called a concentration area The Gini coefficient equals two concentration areas, i.e., G= 2S. When the value of the Gini coefficient is close to 0, the underlying distribution is almost uniform, whereas the value close to 1 indicates a maximal inequality, i.e., a total wealth of a population is concentrated in hands of one man. When the Lorenz curve of income distribution within a certain group is given by L (x), show the formula which computes the Gini coefficient.

Chapter1: Making Economics Decisions

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