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Thread: Gini coefficient : inequality between the rich and the poor

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    Post Gini coefficient : inequality between the rich and the poor



    For those who don't know the Gini coefficient, please check the Wikipedia article. In brief, 0 means total equality (same share of wealth for each person in the country), while 1 is total inequality (one persons owns all the country's wealth). I would like to discuss what in your opinion causes developed "democratic" countries to have quite different Gini coefficient. For instance, the USA's latest stats for 2004 indicate a coefficient of 0.466 (sources), a big increase from 0.408 in 2000.

    The United Nation has stats for all countries (pdf), but for different years - with gaps of up to 15 years. We see that, from the highest to the lowest, Portugal was at 0.385 (in 1997), the UK was at 0.360 (in 1999), Italy at 0.360 (in 2000), France at 0.327 (in 1995), Germany at 0.283 (in 2000), Beglium at 0.250 (in 1996), Japan at 0.249 (in 1993), Denmark at 0.247 (in 1997), and Hungary at 0.244 (in 1999).

    Note that Japan's stats are the oldest (1993) and are in fact considerably higher now. The Asahi Shimbun reported in 2006 that Japan's Gini coefficient was now of 0.314 (sources).

    Other stats give the evolution of estimates over the years, although they do not match UN stats. According to those figures, here is the ranking from most to least unequal for 2000 (countries not listed have no stats for 2000) :

    Mexico : 0.491
    Russia : 0.434
    USA : 0.368
    Estonia : 0.361
    UK : 0.345
    Spain : 0.340
    Greece : 0.338
    Italy : 0.333
    Ireland : 0.323
    Canada : 0.302
    Switzerland : 0.280
    Belgium : 0.277
    Germany : 0.264
    Austria : 0.260
    Luxembourg : 0.260
    Sweden : 0.252
    Norway : 0.251
    Finland : 0.247
    Last edited by Maciamo; 28-05-14 at 16:22.
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    Not suprisingly my country ranks low in Gini coefficient. And yet there is talk in the media about growing income unequalities! I don't have any data on hand, but I have the perception that high paying jobs here aren't very high paying at all in comparison to other EU countries and especially USA. That and high taxation (+ other income transfer schemes) explain the number.

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    I am not surprised. Belgium has one of the lowest income inequaliy in Europe (4th out of 25 EU members), and I hear Belgians complain quite often that the gap between the rich and the poor doesn't stop growing (personally I don't have that feeling). Maybe that's just because poorer immigrants are arriving in bigger number ? In fact we see that typical immigration countries (USA, Canada, Australia, UK, France...) have bigger inequalities than others. I think it's also due to lower tax levels and thus lower redistribution of money (except in France, where hierarchy and immigration are really to blame).
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    The income inequality between the rich and the poor is getting bigger than 10years ago, many people thought the WTO will help the poor countries become better but it didn't. The rich are getting richer and the poor are getting poorer, I think something needs to be done to make this gap smaller.

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    Quote Originally Posted by Minty
    The income inequality between the rich and the poor is getting bigger than 10years ago, many people thought the WTO will help the poor countries become better but it didn't. The rich are getting richer and the poor are getting poorer, I think something needs to be done to make this gap smaller.
    I think you are talking about another problem here : the gap between rich and poor countries. The Gini coefficient calculates the gap between rich and poor people within the same country.
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    Oh sorry I was very tired last night, I didnft read the article you posted. I thought we can discuss all sorts of income inequality here.

    I notice the income inequality is very wide in Malaysia. For those of you who donft know there are ethnic tensions in Malaysia.
    Chinese can live in Malaysia in 80% concordance except if some sort of entity sparks off causing a fracture in this concordance and turn it into a disaster.

    In Malaysia, the Malay rules, the Malaysian government grant all the foremost resources and rights to the Malay. The Sino Malaysian has to work diligently to corroborate the economic system yet the Malay receives all the foremost things that the Malaysian economy has to give.

    The Malay gets 7 percent discount when they purchase, they get to go to university (with no grade A's) and they get to go to the Malaysian university for free while the other racial minorities the Chinese and the Indians even if they have 2-3A's are not admitted to attend Malaysian university, until form 6.

    The Malaysian government also tries to rank downwards the education standard in order to equal the Malayfs intelligent level (so this results in the down grade of the quality of Sino Malaysian which allows them to exhibit that the Malays can get A's as wellc

    This is the list of discriminations in Malaysia against ethnic minorities which are the Chinese and the Indians, the ethnic minorities in Malaysia are made to be silent about this discrimination existing in Malaysia, or else the Malays will be infelicitous and they always threatened to the ethnic minorities that if they are not satisfied with the ethnic minorities, then they will once again replicate May 13 (the day where there was a race riot, the day the Malays slay Chinese)

    China Daily BBS

    List of Racial Discrimination in Malaysia

    List of Racial Discriminations in Malaysia, practiced by Gov't as well as Gov't agencies. This list is an open secret. Best verified by Gov't itself because it got the statistics. This list is not in the order of importance,. that means the first one on the list is not the most important and the last one on the list does not mean least important.

    This list is a common knowledge to a lot of Malaysians, especially those Non-Malays (Tamils, Chinese, Ibans, Kadazans, orang asli, Christians, etc) who were being racially discriminated. Figures in this list are estimates only and please take it as a guide only. Gov't of Malaysia has the most correct figures.

    Is Gov't of Malaysia too ashamed to publish their racist acts by publishing racial statistics?

    This list cover a period of about 47 years since Independence (1957).

    List of racial discriminations (Malaysia):

    50 road names (at least) had been change from Chinese names to other names.

    10 all public universities Vice chancellors are Malays.

    99% of 2000 Petronas gasoline stations are owned by Malays.

    99% of Petronas directors are Malays.

    2% is what Chinese New Village get compare with 98% of what Malays kampongs (villages) got for rural development budget.

    1000 While a Chinese parent with RM1000 salary (monthly) cannot get school-text-book-loan, a Malay parents with RM2000 salary is eligible.

    5% of all new intake for gov't nurses, police, army is Non-Malays.

    2.5% is Gov't budget for Chinese primary schools. Tamil school got only 1%, Malay school got 96.5%.

    5% to 15% Discount for a Malay to buy a house, regardless whether the Malay is rich or poor.

    5% The gov't universities lecturers of Non-Malay origins had been reduced from about 70% in 1965 to only 5% in 2004.

    2% is the percentage of Non-Malays gov't servants in Putrajaya (the new gov't administrative capital).. But Malays make up. 98%.

    7% is the percentage of Chinese gov't servants in the whole gov't (in 2004), drop from 30% in 1960.

    2% is the present Chinese staff in RMAF (Royal Malaysian Air Force), drop from 40% in 1960.

    0 of the gov't TV statio ns (TV1 , TV2, TV3) are directors of Non-Malays origin.

    2 million Malaysian Chinese had emigrated oversea since 40 years ago.

    0.5 million Tamils Malaysians emigrated overseas.

    3 million Indonesians had migrated into Malaysia and became Malaysian citizens with Bumiputra status.

    0 Non-bumi are allowed to get shop lots in the new Muar bus station (Nov 2004).

    1 Out of all the 5 major banks, only one bank is multi-racial, The rest are controlled by Malays.

    10% place for Non-Bumi students for MARA science schools beginning from year 2003, But, only 7% are filled. Before that it was 100% Malays.

    1 Catholic church in Shah Alam took 20 years to apply to be constructed. but told by Malay authority that it must look like a factory and not look like a church. Still not yet approved in 2004.

    10 times, at least, Malays (especially UMNO) had threatened to massacre the Chinese Malaysians using May 13 since 1969 (if non malays talk about this, they will be put under ISA detention for creating unharmorny remarks)

    50 cases whereby Chinese and Indian Malaysi ans are beaten up in the Khidmat Negara (National Service) program in 2003.

    8000 B is the total amount (RM 8000 Billion Rnggit) the Gov't channeled to
    Malays pockets through ASN, ASB, Tabung Haji, privatisation of Gov't agencies, MARA, etc through NEP over 34 years period.

    25% is Chinese population in 2004, drop from 45% in 1957

    20 reported cases whereby Malay ambulance attendance treated Chinese patients inhumanely and Malay Gov't hospital staffs purposely delay attending to Chinese patients in 2003. Unreported cases may be 200.

    600,000 are the Tamil and Chinese Malaysians with red IC and was rejected repeatedly when applying for citizenship for 40 years. Perhaps 60 % of them had already passed away due to old age. This shows racism of how easily Indonesians got their citizenship compare with the Chinese and Indians.

    95% of Gov't contracts are given to Malays.

    3 only 3 out of 12 Human Rights items are ratified by Malaysia Gov't since 1960.

    0 Elimination of All Forms of Racial Discrimination (UN Human Rights) is not ratified by Malaysia Gov't. since 1960s.

    5% Only 5% is given to Non-Malays for Gov't scholarships over 40 years.

    0 Chinese or Tamils were sent to Japan & Korea under "Look East Policy".
    100% All business licensees are controlled by Malay gov't e.g. Taxi permits, AP permit etc.

    2 Chinese taxi drivers were barred from driving in JB Larkin bus station. There are about 30 taxi drivers and 3 are Chinese in Oct 2004. Spoiling taxi club properties was the reason given.

    80% of the Chinese rice millers in Kedah had to be sold to Malay controlled
    Bernas in 1980s. Otherwise, life is make difficult for Chinese rice millers.

    At least 10 Chinese owned bus companies (throughout Malaysia, throughout 40 years) had to be sold to MARA or other Malay transport companies due to rejection by Malay authority to Chinese application for bus routes and rejection for their application for new buses. (FYI, during the times this bus company were operate by Chinese company without the help of government and they have no make any loss but when the government base company (malay company) take over all the Chinese bus company, they declare they have make loss and the government have to use public fund to help them).
    1 Dewan Gan Boon Leong (in Malacca) was altered to other name (e.g. Dewan Serbaguna or sort ) when it was being officially used for a few days. Gov't try to shun Chinese names. This racism happened in around year 2000 or sort.

    100% All contractors working under Petronas projects must be Bumiputra status.

    3% of Petronas employees are Chinese.

    30 gov't produced TV dramas and film always showed that the bad guys had Chinese; face and the good guys had Malay face. You can check it out since
    1970s. Recent years, this tendency become less.

    100 big companies set up, managed and owned by Chinese Malaysians were taken over / bought over by gov't / Malays and later managed by Malays since 1970s e.g. Maybank, Southern Bank, UMBC, UMW, MISC, UTC, etc to name few...

    100 constituencies (states and parliaments) had been racistly re-delineated so that Chinese voters were diluted so that Chinese candidates particularly DAP candidates lost in election since 1970s.

    20 constituencies won by DAP would not get funds from gov't to develop. Or, these Chinese majority constituencies would be the last to be developed.
    0 temples / churches were built for each Taman (housing estates). But, every Taman got at least one mosque / surau built. (each mosque have the capacity to occupy 5,000 people which cost billions to build it)
    3000 mosques / surau were built in all Taman throughout Malaysia since 1970. No temples, no churches are required to be built in Taman.

    2637 Malay primary schools built since 1968 – 2000.

    48 Chinese primary schools closed. down since 1968 – 2000.

    144 Tamil primary schools closed down since 1968 – 2000.

    128 STPM Chinese top students could not get into the course that they aspired i.e. Medicine (mostly left this country and migrate to UK, USA, Singapore.

    1 publishing of Bible in Iban language banned (in 2002?) / They try to convert every race and ethnic to Islam (They even convert the native people and also the ophans).

    20 cases every year whereby Chinese drivers who accidentally knocked down Malays were seriously assaulted or killed by Malays.

    50 cases each year whereby Chinese, especially Chinese youths being beaten up by Malay youths in public places. We may check at police reports provided the police took the report, otherwise, there will be no record.

    7% is the present (2004) Malaysian Indians population, a drop from 12% in 1957.

    0 percent of Non-Malays staffs is legally required in Malay companies. But there must be 30 % Malays staffs in Chinese companies.

    12% is what ASN / ASB got per annum while banks' fixed deposit is only about 3.5% per annum.

    There are hundreds more racial discrimin ations in Malaysia to add to this list of "colossal" racism. It is hoped that the victims of racism will write in to expose racism. Malaysian Government should publish statistics showing how much Malays had benefited from the "special rights" of Malays and at the same time tell the statistics of how much other minority races are being discriminated. Hence, the responsibility lies in the Malaysian gov't itself to publish unadulterated statistics of racial discrimination. If the Malaysia gov't hide the statistics above, then there must be some evil doings, immoral doings, sinful doings and shameful doings, like the Nazi, going on onto the Non-Malays of Malaysia.

    It's true.. that recently they have a debate in the parliment where they want to make sure all public listed company CEO and Managing Director must be Malays because they said we have to give them the chance to sit at high post because they were not clever enough to do it themself so other race must be fair to them and let them expose to high position...

    Civilized nation, unlike evil Nazi, must publish statistics to show its treatment on its minority races, This is what Malaysia must publish...We are asking for the publication of the statistics showing how "implementation of special rights of Malays" had inflicted colossal racial discri mination onto Non-Malays.
    Ends
    So, it is not the ethnic minorities' fault that there is such great income disparity in Malaysia, it's the Malay's fault.

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    The Economist has published an interesting article about the growing inequality between the rich and the poor in the USA. A chart shows how income inequality declined after WWII and was at a stable low from the 1950's to the late 1980's. Then the gap started growing out in the 1990's and hasn't stopped since.

    We see that nowadays the top 1% income earners in the US (about 1.5 million workers) receive 15% of the country's total income, and the top 0.01% (about 15,000 tax payers) as much as 3% of all the country's GDP. If I did not mistake in my calculation, this means that these top 30,000 people eran about 300x more than average American. In terms of GDP per capita, an 'average American' means 'someone earning 44,000 USD per year', but this actually 88,000 US$ as only about half of the population is in employment; so, multiplied by 300, we are talking about salaries of over 25 million US$ a year, or 2 million US$ a month...

    Another article from the Economist points out the rising problem of inequality in Japan ! The Gini chart shows that Japan now stands between Britain and Australia for income inequality, and is thus more unequal than almost all European countries. The Japanese blame rising inequality on globalisation (unskilled jobs moving to China thus creating unemployment) and the ageing of population (more retired people with low incomes from pensions).
    Last edited by Maciamo; 18-06-06 at 14:56.
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    Great article. Thanks.
    Republican policies are effective at redistributing the wealth to the wealthy.

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    The growing inequality is generally speaking a mathematical problem. With ever growing GDP of countries there will always be bigger pile of money to be made by smartest individuals. Let's say Bill Gates is worth 40 billion dollars which is a very small fraction of all USA wealth. 300 years ago nobody could acquire so much money just because all USA wealth was smaller than that, even if adjusted for inflation.
    On the other hand the poorest people in any country will always have 0 of money.
    You do the math... :)

    Don't cry for the poor too much in reach countries. It's not the same as being poor in poor counties, it's not the same as being poor in past. They live in better conditions than middle class 200 years ago, in some regards better than royals. In many western countries, even without working a day in their lives and contributing to the society, the poor will get equalisation package (wealther system) consisting of free apartment, food, furniture, cloths, TV cable, and even an equal health care service.
    Well, having said that, I don't mind helping the poor, and I wish everyone on this planet a long and great live. But at least once in my life I would like to hear a thank you from the poor, instead of constant demands for more.
    Cheers

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    I don't see how relevant the Gini index is wit out other information on the countries economy and living standards.

    Senario a. Under communist rule people could be cripplingly poor and the gap between rich and poor extremely small.

    Senario b. Alternatively you could have a large percentage of millionaires in a capitalist arrangement with the lowest on minimum wage, yet the standard of living for the lowest paid is still better than those under the communist rule.

    My point being the Gini index would suggest that that senario a was some how better than senario b, but in real terms that would not be the case.

    I have noticed during the recession business owners tend to cut jobs rather than cut their margins, maintaining their profit at the expense of social poverty. I imagine the gap globally has widened considerably in the last 3 years alone.

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    Quote Originally Posted by edao View Post
    I don't see how relevant the Gini index is wit out other information on the countries economy and living standards.

    Senario a. Under communist rule people could be cripplingly poor and the gap between rich and poor extremely small.

    .

    .................Agreed.

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    is difficult to have a fair distribution of richness in the non-developed countries, when usa and other corrupt european corporations are working to destroy the work of good latin american leaders as hugo chavez or correa.

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    Quote Originally Posted by Minty
    The rich are getting richer and the poor are getting poorer, I think something needs to be done to make this gap smaller.
    Sorry but this is simply not true. The poor are not really getting poorer.

    The reality is, that the rich are getting richer fast, while the poor are also getting richer, just not so fast.

    And this is what should be expected under capitalism as perfectly normal.

    The only way to make the gap smaller would be to make everyone - both the rich and the poor - poorer.

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    1 out of 1 members found this post helpful.
    Quote Originally Posted by Tomenable View Post


    Sorry but this is simply not true. The poor are not really getting poorer.

    The reality is, that the rich are getting richer fast, while the poor are also getting richer, just not so fast.

    And this is what should be expected under capitalism as perfectly normal.

    The only way to make the gap smaller would be to make everyone - both the rich and the poor - poorer.
    It should be mentioned that the income of rich is taxed around 50%, which goes to supplement services or income for poor people, who don't pay taxes at all.
    Be wary of people who tend to glorify the past, underestimate presence, and demonize the future.

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