EC120 Chapter Notes - Chapter 20: Gini Coefficient, Rfactor, Political Philosophy

• School: WLU
• Department: Economics
• Course: EC120
• Professor: Jason Dean

Document Summary

Gini coeicient: measure of inequality that calculates the extent to which the distribution of income among individuals within a country deviates from a perfectly equal distribution. 0 means a perfect equality every person has the same amount of income. 1 means a perfect inequality one person has all of the income, everyone else has none. R-factor: percentage diference between the gini coeicient based on market income and the coeicient based on after-tax/transfer income. An increase in the r-factor means an increases in redistribution through the tax/transfer system! Poverty rate: percentage of the population whose family income falls below an absolute level called the poverty line. Poverty line: an absolute level of income set by the federal government for each family size, below which a family is deemed to be in poverty. Canada does not have an oicial measure of the poverty line, however. Statistics canada produces an annual estimate called the low-income cut- of (lico)