Question

What term is used to describe the unequal distribution of income and wealth in a capitalist society, where a significant portion of wealth is held by a small fraction of the population?

• A. Progressive taxation
• B. Pareto efficiency
• C. Gini coefficient
• D. Economic equilibrium

Answer 1

Answer:

C. Gini coefficient

Gini coefficient

• The Gini coefficient, also known as the Gini index or Gini ratio, is a statistical measure used to assess income or wealth inequality within a population or an economic system.
• It is named after the Italian statistician Corrado Gini, who developed the concept in the early 20th century
• It quantifies the degree of income or wealth inequality on a scale from 0 to 1
• A Gini coefficient of 0.0 represents perfect equality, where everyone has the same income or wealth.
• A Gini coefficient of 1.0 represents perfect inequality, where one individual or household has all the income or wealth.
• The Gini coefficient is widely used by economists, policymakers, and researchers to study income and wealth distribution within countries and to compare inequality levels across different countries.
• It helps identify trends, disparities, and potential areas for policy intervention.