Gini Coefficient

Gini Coefficient

Recently, the Economic Research Department of State Bank of India (SBI) has released its research report named ‘Ecowrap’.

It analyzes the impact of rice and wheat procurement shares on the Gini coefficient for 20 and 9 states, respectively.

  • The Gini coefficient is a statistical measure of the difference in income or wealth between the rich and the poor of a country.
  • Its value ranges from 0 (or 0%) to 1 (or 100%). In this, 0 represents perfect equality and 1 represents perfect inequality.
  • A value greater than 1 is theoretically possible due to negative income or wealth.
  • If there is a general increase in the Gini coefficient, it means that government policies are not inclusive.
  • Also, these policies may benefit the rich more than the poor.
  • A Gini coefficient value below 0.40 is generally considered to be within tolerable limits.

Source – Business Standard

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