Where is income inequality greatest

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Share this link:. Katherine Schaeffer is a research analyst at Pew Research Center. Facts are more important than ever. How wealth inequality has changed in the U. Follow Us. The Palma ratio is an alternative to the Gini index, and focuses on the differences between those in the top and bottom income brackets.

This measure has become popular as more income inequality research focuses on the growing divide between the richest and poorest in society. According to the Palma ratio figures in the UN Human Development Index , Ukraine, Norway and Slovenia were the most equal countries to live in when considering distribution of income between the richest and poorest in society.

South Africa, Haiti and Botswana had the starkest inequalities in income, based on the Palma ratio. Mixed rankings are based on a range of measures rather than solely focusing on income, wealth or consumption.

The World Happiness Report ranks countries from 1 to 10 in terms of happiness, and is based on a survey of 1, people from each country. Qatar, which has the highest contribution from GDP to its happiness ranking, comes in at Two sources of non-comparability should be noted for distributions of income in particular. First, the surveys can differ in many respects, including whether they use income or consumption expenditure as the living standard indicator.

The distribution of income is typically more unequal than the distribution of consumption. In addition, the definitions of income used differ more often among surveys. Consumption is usually a much better welfare indicator, particularly in developing countries. Second, households differ in size number of members and in the extent of income sharing among members. And individuals differ in age and consumption needs.

Differences among countries in these respects may bias comparisons of distribution. World Bank staff have made an effort to ensure that the data are as comparable as possible.