FAO.org

This tool illustrates the concept of desirable properties any inequality index should respect. In particular, it introduces the distinction between a positive and a normative approach to inequality analysis. Then, it discusses the role of axioms in inequality measurement and their conceptual meaning. Finally, using the Gini Index and the variance, a step-by-step procedure and numerical examples are introduced for operational purposes.

• For further information, see also:
• Charting Income Inequality. The Lorenz Curve. EASYPol Series 000
• Social Welfare Analysis of Income Distributions: Ranking Income Distributions with Lorenz Curves. EASYPol Series 001
• Inequality Analysis: The Gini Index. EASYPol Series 040
• Social Welfare Analysis of Income Distributions: Social Welfare, Social Welfare Functions and Inequality Aversion. EASYPol Series 041
• Policy Impacts on Inequality. Welfare Based Measures of Inequality: The Atkinson Index. EASYPol Series 050
• Describing Income Inequality. Theil Index and Entropy Class Indexes. EASYPol Series 051
• Policy Impacts on Inequality. Decomposition of Income Inequality by Income Sources. EASYPol Series 053
• Policy Impacts on Inequality: Simple Inequality Measures. EASYPol Series 080

This paper is part of the FAO Policy series: EASYPol-Resources for policy making (in agriculture, rural development and food security). To find other EASYPol series' resources, go to the Policy Support and Governance website>Resources and type "EASYPol" in the free text search.