Inequality Chart of the Day

From Will

Wilkinson:

smeeding-inequality.jpg

The Gini coefficient is the generally-accepted standard measure of inequality,

and the dark-green bars show the amount of after-tax income inequality in 16

OECD countries (click on the chart for a bigger version). The difference between

the bars, shown in light green, is a measure of redistribution, basically: the

larger number is the amount of pre-tax income inequality.

As Wilkinson points out, the US has less income inequality, before taxes, than

the UK; it’s tied with both Germany and Australia. (Yes, Germany – but

remember it’s still not all that much time since West Germany absorbed East

Germany, large parts of which are still very depressed, and that skews things

a bit.)

For those of us who laud the Scandinavian model, the numbers for Sweden are

worth noting. Sweden is clearly successful in redistributing income, since its

after-tax Gini coefficient of 25 is much lower than the 37 seen in the US. But

interestingly it seems happy with a lot of before-tax inequality, since the

market-income Gini coefficient is a high 46.

(Via Cowen)

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