Lorenz Curve And Income Inequality

Gini Coefficient 2006: 30.9

Gini Coefficient 2016: 33

Lorenz Curve for Luxembourg 2006-2016

This Lorenz curve and the Gini Coefficient data shows that from 2006-2016 in the country of Luxembourg, income inequality rose. Visually, we can make that assumption by looking at the Lorenz curve and seeing that the 2016 trendline is further from the line of perfect equality than the 2006 line. We can also make that assumption by looking at the Gini Coefficients from those two years; because the Gini Coefficient in 2016 is higher than the Gini Coefficient in 2006, that means that there is more income inequality in 2016. 

Lorenz curves and Gini Coefficients are great, easy, and accurate ways to determine the levels of income inequality in a country. The higher the Gini Coefficient, or the further the Lorenz curve deviates from the line of perfect equality, the higher the income inequality is in a country. These tools are useful for one main reason. It is necessary for citizens and governments to know their countries' levels of inequality to hold their governments or themselves accountable. One of any given government's aims is to reduce income inequality to a healthy level, and if they aren't succeeding in that goal, then the people need to know so they can elect new officials.

Percent of the population in absolute poverty: 0.1%

Percent of the population in relative poverty: N/A.

Comments

Post a Comment

Popular posts from this blog

1--The Level of Overall Economic Activity

Image
Real GDP for the Last 10 Years* Real GDP Per Capita for the Last 10 Years* Real GDP Growth Per Year for the Last 10 Years 2006: 49.60 billion USD 2008: $108,577.35 2008: -1.3% growth 2007: 53.74 billion USD  2009: $101,939.62 2009: -4.4% growth 2008: 53.06 billion USD 2010: $104,965.30 2010: 4.9% growth 2009: 50.74 billion USD 2011: $105,264.75 2011: 2.5% growth 2010: 53.21 billion USD 2012: $102,404.61 2012: -0.4% growth 2011: 54.56 billion USD 2013: $103,721.75 2013: 3.7% growth 2012: 54.37 billion USD 2014: $105,658.52 2014: 4.3% growth 2013: 56.36 billion USD 2015: $107,235.27 2015: 3.9% growth 2014: 59.61 billion USD 2016: $107,479.51 2016: 2.4% growth 2015: 61.32 billion USD 2017: $106,519.59 2017: 1.5% growth 2016: 63.21 billion USD 2018: $107.243.23 2018: 2.6% growth *Source: “Real GDP for the Last 10 Years” **Source: “Real GDP Per Capita for the Last 10 Years” ***Source: “Real G...
Read more

2--Aggregate Demand

Image
Charlie McGill Dr. Quillin Economics 4/2/2020 Macroeconomics: Aggregate Demand Consumer Spending in Luxembourg for the Last 10 Years Source: “Luxembourg Consumer Spending 2000-2019 Data: 2020-2022 Forecast: Historical.” Business Confidence in Luxembourg in the Last 10 Years Source: “Luxembourg Business Confidence 1985-2020 Data: 2021-2022 Forecast: Calendar.” Government Spending in Luxembourg in the Last 10 Years Source: “Luxembourg Government Spending 2000-2019 Data: 2020-2022 Forecast: Historical.” Balance of Trade in Luxembourg for the Last 10 Years Source: “Luxembourg Balance of Trade 1988-2020 Data: 2021-2022 Forecast: Calendar.” When analyzing all of these indicators, it can be unclear at first as to how aggregate demand has changed over the past 10 years in Luxembourg. This is because of the massive fluctuations in business confidence and balance of trade. Despite those fluctuations, both business confidence and balance of trade have remained ...
Read more

Luxembourg and the WTO

    For Luxembourg, a minuscule country in size and influence in the World Trade Organization, their relationship with the WTO has been mostly non-consequential. This can be seen immediately through a few telling statistics. A WTO report of Luxembourg's trade relations details the following (Luxembourg): 77.5% of merchandise exports go to European union. 77.1% of merchandise imports come from European union. 74.6% of commercial services exports go to EU. 65.4% of commercial services imports come from EU.  What this trade profile says, in effect, is that without membership in the WTO, Luxembourg would maintain their most robust trading parter, since they are a member state of the EU, and any losses in trade could be easily made up through EU trade agreements with non-member states. This isn't to say that Luxembourg's membership has been detrimental to their macroeconomic trade; it simply has not moved the needle all that much.      With that being ...
Read more