What Is the Gini Coefficient?

The Gini coefficient refers to a commonly used indicator used internationally to measure the income gap of residents in a country or region.

Gini Coefficient

Including economic development level, social and cultural traditions, political and economic systems, etc. One of the important factors is what kind of goals policy makers hope to achieve with the income distribution system, whether to focus on the stimulus and incentive effect of the difference in distribution, or on the regulation and guarantee function of the distribution policy.

In reality, Japan has one of the lowest Gini coefficients in the world. According to a report by Kyodo News Agency on October 11, 2013, the 2011 survey report released by the Ministry of Health, Labour and Welfare on Friday showed that Japan's domestic Gini coefficient was 0.2708, a record high. According to reports, Japan's Gini coefficient has continued to rise since 1984. This survey was 0.2708, an increase of 0.0218 from the 2008 data, a record high. The Ministry of Labor, Labour and Welfare believes that the increase in the gap between lower-income elderly and singleton families has widened. It is reported that the Gini coefficient is an important analysis indicator used to comprehensively examine the differences in income distribution among residents in a country or region. The closer the Gini coefficient is to 1, the larger the income distribution gap. In Japan, the survey of the Gini coefficient is conducted every three years or so, this is the 16th time. Japan's Gini coefficient is generally around 0.25, Germany's is about 0.3, and the United States' Gini coefficient has exceeded the warning line of 0.4. Gini coefficients in developing countries are generally high, around 0.4 ^[11]

Quantitative measurement of the Gini coefficient in society

advantage

Since the Gini coefficient gives a quantitative boundary that reflects the degree of difference between the rich and the poor, it can objectively and intuitively reflect and monitor the gap between the rich and the poor, forecast, warn and prevent polarization between the rich and the poor. Therefore, it has been widely recognized and widely adopted by countries around the world.

Disadvantage

1. There is no indication of where the distribution is unfair.

2. There is no international standard for the Gini coefficient. Some questions such as whether to remove

   Year 2009,

   According to the regional division, the Gini coefficient of the eastern region is 0.59, the Gini coefficient of the central region is 0.57, and the Gini coefficient of the western region is 0.55. It can be seen that the income gap between the eastern, central, and western regions is closely related to the degree of market economy development.

   "From the perspective of the economic development of various countries, high Gini coefficients are a common phenomenon in the process of rapid economic development and a natural result of the efficient allocation of resources by the market. Western developed countries also have high Gini coefficients without secondary distribution, such as At that time, Italy was 0.53, the United States was 0.49, and Germany was 0.5. After the western developed countries implemented the distribution again, the Gini coefficient was about 0.3. But the problem in our country is that there is basically no secondary distribution.