The wealth gap measures the disparity between the wealthiest and poorest citizens of a nation, state, city, or demographic group in terms of wealth distribution. Income inequality, which measures how much money individuals make, is directly linked to wealth disparity.
While income disparity is a factor, so too is the value of one’s bank accounts, stocks, and other assets and one’s house and other goods like jewelry, vehicles, and other trinkets. One of the primary causes of uneven living conditions is a disparity in one’s financial resources.
A growing body of evidence demonstrates that, although inequality between countries has decreased due to globalization, income disparities inside countries have widened. Inequality tends to be stronger in emerging nations than in wealthy ones.
There are exceptions to this trend, such as in the United States and Russia, where the Gini coefficient is often higher than in other wealthy nations.
Wealth inequality & the Gini index
Corrado Gini, an Italian statistician, devised the Gini index or Gini coefficient as a statistical indicator of wealth disparity. Measurement of the income distribution, or wealth distribution, is used to calculate the Gini index. There is a 0 to 1 range for the Gini coefficient.
Equality is best represented by a coefficient of zero, meaning that everyone in the nation (or other people groups) receives the same income. Having a wealth inequality coefficient near 1 indicates a higher level of inequality.
The Gini coefficient may also be a percentage, where 0% represents perfect equality, and 100% represents the utmost level of disparity that can be tolerated.
Wealth inequality (World Bank Gini index): The 10 largest most unequal countries:
- South Africa – 63.0%
- Namibia – 59.1%
- Suriname – 57.9%
- Zambia – 57.1%
- Sao Tome and Principe – 56.3%
- Central African Republic – 56.2%
- Eswatini – 54.6%
- Mozambique – 54.0%
- Brazil – 53.4%
- Botswana – 53.3%
Income inequality has worsened in South Africa over time. The wealthiest 1% of Americans pocket over 20% of the nation’s total income, while the top 10% pocket 60%. 90% of South African earnings take home only 35% of the country’s gross domestic product.
For example, whites have an advantage in finding a job (and a better one) because they are more likely to be employed. In contrast, blacks have a disadvantage since they are less likely to find work (and a better one) because of their race, gender, and location.
A large portion of the workforce in many African nations is locked in low-wage jobs that pay significantly less than those in higher-wage jobs, which contributes to a widening gap between the wealthy and the rest of the population.
For example, poor educational systems that fail to adequately equip most residents for higher-paying employment and corrupt or authoritarian regimes are frequently to blame for this disparity.
Several African nations lack even the most necessities like fertile land or clean drinking water, which may harm overall economic development in Eastern and Southern Africa.
List of the 10 countries with the lowest Gini index of wealth inequality:
- Slovenia – 24.6%
- Czech Republic – 25.0%
- Slovakia – 25.0%
- Belarus – 25.3%
- Moldova – 25.7%
- United Arab Emirates – 26.0%
- Iceland – 26.1%
- Azerbaijan – 26.6%
- Ukraine – 26.6%
- Belgium – 27.2%
Almost all of the top 10 nations are situated in Europe or on the Europe/Asia border (Azerbaijan). Only 12% of Europe’s total income goes to the richest one percent of earners, while 22% goes to the bottom half.
Compared to other countries, in the United States, which has more billionaires per capita than any other, the richest one percent of Americans keep 20% of their earnings.
In contrast, the poorest half of Americans keep 10% of their earnings. The lower/higher levels of inequality in Europe may be traced to the fact that the continent has not allowed its market economy to morph into a market society.
The free market dictates everything from salaries to education. Social healthcare systems and more favorable labor markets are two examples of this.
Also See: US Trade Deficit by Country 2022
Here are the 10 countries with the greatest inequality of wealth:
- South Africa (63)
- Namibia (59.1)
- Suriname (57.9)
- Zambia (57.1)
- Sao Tome And Principe (56.3)
- Central African Republic (56.2)
- Eswatini (54.6)
- Mozambique (54)
- Brazil (53.4)
- Botswana (53.3)
|Country||Gini Index||2022 Population|
|Sao Tome and Principe||56.3000||227.6790|
|Central African Republic||56.2000||5016.6780|
|Republic of the Congo||48.9000||5797.8050|
|Papua New Guinea||41.9000||9292.1690|
|Trinidad and Tobago||40.3000||1406.5850|
|Bosnia and Herzegovina||33||3249.3170|
|United Arab Emirates||26||10081.7850|