Gini Index
Description:
Gini Index, Adjusted Household after-tax income
Methods and Limitations:
The Gini index is a measure of income inequality. The Gini index measures how much an income distribution deviates from perfect equality. Values of the Gini index can range from 0 to 1. A value of 0 denotes a perfectly equal distribution in a population, where all units receive exactly the same amount of income. A value of 1 denotes a perfectly unequal distribution, where one unit has all of the income in the economy.
For the census, Gini index values are calculated for three types of adjusted household income—market income, total income and after-tax income. Adjusted income is computed by dividing the household income by a factor equal to the square root of the household size (known as the equivalence scale). This adjustment for different household sizes takes into account economies of scale. It reflects the fact that the needs of a household increase, but at a decreasing rate, as the number of members increases.
The boundaries and names of census geographies can change from one census to the next. In order to facilitate data comparisons between censuses, previous census data have been adjusted to reflect as closely as possible the 2021 boundaries of these areas.
Source:
Statistics Canada. Table 98-10-0097-01 Income inequality statistics across Canada: Canada, provinces and territories, census metropolitan areas and census agglomerations with parts
Gini Index in the Sustainable Development Goals
Click on the SDG to reveal more information
1. End poverty in all its forms everywhere
Extreme poverty rates have been cut by more than half since 1990. While this is a remarkable achievement, one in five people in developing regions still live on less than $1.90 a day, and there are millions more who make little more than this daily amount, plus many people risk slipping back into poverty.
Poverty is more than the lack of income and resources to ensure a sustainable livelihood. Its manifestations include hunger and malnutrition, limited access to education and other basic services, social discrimination and exclusion as well as the lack of participation in decision-making. Economic growth must be inclusive to provide sustainable jobs and promote equality.
10. Reduce inequality within and among countries
The international community has made significant strides towards lifting people out of poverty. The most vulnerable nations – the least developed countries, the landlocked developing countries and the small island developing states – continue to make inroads into poverty reduction. However, inequality still persists and large disparities remain in access to health and education services and other assets.
Additionally, while income inequality between countries may have been reduced, inequality within countries has risen. There is growing consensus that economic growth is not sufficient to reduce poverty if it is not inclusive and if it does not involve the three dimensions of sustainable development – economic, social and environmental.
To reduce inequality, policies should be universal in principle paying attention to the needs of disadvantaged and marginalized populations.