Ethiopia gini index was at level of 35 % in 2015, up from 33. Determinants of income inequality in urban ethiopia. Gini index world bank estimate ethiopia world bank, development research group. Gross national income for ethiopia mktgnieta646nwdb fred. Graph and download economic data for gini index for ethiopia sipovginieth from 1995 to 2015 about ethiopia, gini, and indexes. Measuring education inequality gini coefficients of education english abstract. If a 0, it means the lorenz curve is actually the line of equality.
Yet despite progress toward eliminating extreme poverty, ethiopia remains one of the poorest countries in the world, due both to rapid population growth and a low starting base. Poverty and inequality in ethiopia, 19956201516 oxford. The gini coefficient can vary from 0 perfect equality, also represented as 0% to 1 perfect inequality, also represented as 100%. This implies that the poor people in ethiopia are vulnerable to further poverty if poverty eradication resources and programmes do not specifically target and reach the chronically poor. Ethiopia has also managed to keep income inequality at a relatively lower level since the early 1990s. In other words, even small changes in the overall distribution of inequality can lead to sizeable changes in the incidence of poverty. Lorenz curve and gini coefficient were used for the study. This shows that income inequality does become an economic, political and social problem for china. I am pleased to present the 2014 national human development report, which has been written on the theme of accelerating inclusive growth for sustainable human development in ethiopia. The gini coefficient ranges between 0 and 1 or it can also be expressed as a number from 0 to 100 and is given by the ratio of the areas. Similar to the previous years, inequality is higher in urban areas than in rural areas. Gini index measures the extent to which the distribution of income or consumption expenditure among individuals or households within an economy deviates from a perfectly equal distribution. The paper examines the pattern of poverty, growth and inequality in ethiopia in the. For more information and methodology, please see povcalnet.
Economic growth and income convergence in ethiopia. Patterns and structure of household income inequality in. Gini coefficient simple english wikipedia, the free. Overall, inclusive growth in ethiopia has had a dramatic impact on. Complexities and dynamics of rural poverty in ethiopia. Dec 20, 2019 graph and download economic data for gross national income for ethiopia mktgnieta646nwdb from 1981 to 2018 about ethiopia and gni. The gini index or gini coefficient is a statistical measure of distribution developed by the italian statistician corrado gini in 1912. The table shows a comparison of gini coefficients between the years 198788 and 202014 of the per capita income inequality provincewise. Pdf sources of income inequality among farm households in. With a gini coefficient of 30, ethiopia remains among the most egalitarian. Ethiopia s progress towards eradicating poverty paper to be presented to the interagency group meeting on the implementation of the third united nations decade for the eradication of poverty. A global perspective prepared by era dablanorris, kalpana kochhar, frantisek ricka, nujin suphaphiphat, and evridiki tsounta with contributions from preya sharma and veronique salins1 authorized for distribution by siddharh tiwari june 2015 jel classification numbers. The authors use a gini index to measure inequality in educational attainment. Economic inequality rising in pakistan pakistan dawn.
National income inequality using gini coefficient in 201011 is 0. Official pdf, 218 pages world bank documents world bank group. Extended version of the gini index with different weighting schemes are also discussed. The gini coefficient is a single number aimed at measuring the degree of inequality in a distribution. Ethiopias gini coefficient has consistently remained below 30% while other countries have gini coefficients around 40%. Different descriptive measures of income inequality the gini coefficient and general entropy of thiels indices of inequality were applied to data that came from a formal survey of 154 farm households in sodozuria district, southern ethiopia. Oct 16, 2019 graph and download economic data for gini index for ethiopia sipovginieth from 1995 to 2015 about ethiopia, gini, and indexes. The gini coefficient also known as the gini index or gini ratio is a measure of differences in income. Extreme disparities in income are slowing the pace of poverty reduction and hampering the development of broadbased economic growth. It was developed by the italian statistician corrado gini in 1912.
Confidence intervals for the population gini coefficient can be calculated using bootstrap techniques. Oct 22, 2019 the gini coefficient, or gini index, is derived from the lorenz curve, and like the lorenz curve it measures the degree of economic equality across a given population, and simplifies this reality into a single number. January 2015 poverty global practice africa region. Souring income and wealth inequality in ethiopia1 introduction. Oct 16, 2019 the gini index measures the area between the lorenz curve and a hypothetical line of absolute equality, expressed as a percentage of the maximum area under the line. According to the gini coefficient, africa is the second most unequal continent after latin america and inequalities have not been reducing over time figure 1. Ethiopia offers a good example of fast growth, rapid poverty. Inequality measured by gini coefficient by region and ruralurban, 201011. With a gini coefficient of 30, ethiopia remains among the most egalitarian countries in. Inequality and growth in an agriculturalled development model. A lorenz curve plots the cumulative percentages of total income received against the cumulative number of recipients, starting with. Gross national income for ethiopia mktgnieta646nwdb.
The gini coefficient, or gini index, is derived from the lorenz curve, and like the lorenz curve it measures the degree of economic equality across a given population, and simplifies this reality into a single number. Data and research on social and welfare issues including families and children, gender equality, gini coefficient, wellbeing, poverty reduction, human capital and inequality. The ethiopia observatory not all inequalities are unjust, but the levels of inequality across much of africa are unjustified and profoundly unfair. Thus, addressing inequality in ethiopia has been an important component of poverty reduction and hence better livelihood of the society. A value of 0 represents absolute equality, a value of 100 absolute inequality. The gini c oefficient is the most common measure of income inequality used internationally. Gini coefficient, between 199900 and 200405 is increased from 0. One of the most common ways to measure income inequality is the gini coefficient, a ratio which ranges from 0 where all households earn the same income and therefore are equal to 1. South africa is now recognised by oxfam international as the most unequal country on earth and significantly more unequal than at the end of apartheid. Income inequality measured by gini coefficient of consumption expenditure increased from 0.
The most commonly used measure of inequality is the gini coefficient which varies between 0 i. However, rural inequality marginally increased, while urban inequality declined 1 1 ethiopia. Measuring education inequality gini coefficients of. This is a list of countries or dependencies by income inequality metrics, including gini coefficients.
Trends in national, rural and urban gini coefficients 18 table 4. Feb 24, 2010 the gini coefficient ranges between 0 and 1 or it can also be expressed as a number from 0 to 100 and is given by the ratio of the areas. The gini coefficient is a commonlyused measure of income inequality that condenses the entire income distribution for a country into a single number between 0 and 1. Graph and download economic data for gross national income for ethiopia mktgnieta646nwdb from 1981 to 2018 about ethiopia and gni. The gini coefficients main advantage is that it is a measure of inequality by means of a ratio analysis, rather than a variable unrepresentative of most of the population, such as per capita income or gross domestic product. In contrast, based on 2012 data, indonesias fiscal policy only reduced the gini by 3 points. Income inequality in new york state community and regional. With a gini coefficient of 30, ethiopia remains among the most egalitarian countries in the world. The gini coefficient can be used to indicate how the. It is most often used in economics to measure how far a countrys wealth or income distribution deviates from a totally equal distribution.
It compares each households income position to that of all other households in order to measure income distribution. In this case, the gini coefficient is 0 and it means there is perfect distribution of income everyone earns the same amount. For a number of countries, he calculates the value of b, which he calls. Ethiopia has also continued to be a more egalitarian country than most in africa. Gini index world bank estimate world bank, development research group. The federal democratic republic of ethiopia international. The gini coefficient is applied to measure the overall income inequality. Growth, poverty and inequality in ethiopia alemayehu geda. They present two methods direct and indirect for calculating an education gini index, and generate a quinquennial data set on education gini indexes for the over15population. They obtained statistically significant coefficients of 2. The trends of the gini coefficients of consumption inequality henceforth, inequality reported. Incomes are more equally distributed and fewer people are poor where social spending is high. Ethiopia offers a good example of fast growth, rapid poverty reduction and stable inequality. Measure of the deviation of the distribution of income among individuals or households within a country from a perfectly equal distribution.
Like the relative mean difference, there does not exist a sample statistic that is in general an unbiased estimator of the population gini coefficient. Household in rural ethiopia are diversifying activity both within. Cereal crops, cash crops, gini coefficient, lorenz curve, income. For example, brazils gini coefficient fell by 14 points after a concerted effort to reduce inequality through fiscal policy. The gini coefficient a globally accepted measure of income inequality for south africa, as listed by the world bank as well as the central intelligence agency, is the highest in the world. A lorenz curve plots the cumulative percentages of total income received against the cumulative number of recipients, starting with the poorest individual. Overall, inclusive growth in ethiopia has had a dramatic impact on poverty. Ethiopia s gini coefficient has consistently remained below 30% while other countries have gini coefficients around 40%. Rural income inequality using gini coefficient in 201516 is 0. The gini coefficient is usually a number between 0 and 1 or 0 to 100. Data are based on primary household survey data obtained from government statistical agencies and world bank country departments. National income inequality using gini coefficient in 201516 is 0. Smallscale farmers are the largest group of poor people in ethiopia.
Pdf relationship between income inequality and economic. The gini for rural ethiopia is particularly low at 27%, and given that the majority of the population is rural this contributes to a low. Gini coefficient is the most commonly used measure of. Summary this tool addresses the most popular inequality index, the gini index. The gini coefficient is a number between 0 and 1, where 0 corresponds with perfect equality where everyone has the same income and 1 corresponds with perfect inequality where one person has all the incomeand everyone else has no income.
It is over 15 years since the last national human development report for ethiopia was published and much has changed in the intervening period. This mirrors a very equal consumption distribution in rural areas, but also results from regulations that prevent farmers from consolidating. It discusses its characteristics and the link with another popular graphical tool of representing inequality, the lorenz curve. Do demographic and socioeconomic characteristics explain. Sources of income inequality among farm households in ethiopia. The gini index measures the area between the lorenz curve and a hypothetical line of absolute equality, expressed as a percentage of the maximum area under the line. Ethiopia has the lowest level of incomeinequality in africa and one of the lowest in the world, with a gini coefficient comparable to that of the scandinavian countries. Inequality, estimated by means of the gini coefficient, declined slightly between 20045 and. Ethiopia has shown evident economic growth that is higher than the growth rates. While ethiopia still has a low level of income inequality, the upward trend in the gini coefficient from 0. Trends in total, rural and urban gini coefficients of the distribution of household consumption per capita were computed on nationally representative household.
Ethiopia offers a good example of fast growth, rapid. With b an unspecified parameter and g the gini coefficient of distribution. Income or wealth inequality gini coefficient 30 international monetary fund country report no. Data are based on primary household survey data obtained from. Urban income inequality using gini coefficient in 201011 is 0. Rural income inequality using gini coefficient in 201011 is 0. Income inequality, as measured by the gini coefficient, has risen from 30. Only the gini coefficients for ethiopia are based on the survey data.