Lorenz curve
From The Art and Popular Culture Encyclopedia
|
Related e |
|
Featured: |
In economics, the Lorenz curve is a graphical representation of the distribution of income or of wealth. It was developed by Max O. Lorenz in 1905 for representing inequality of the wealth distribution.
The curve is a graph showing the proportion of overall income or wealth assumed by the bottom x% of the people, although this is not rigorously true for a finite population (see below). It is often used to represent income distribution, where it shows for the bottom x% of households, what percentage (y%) of the total income they have. The percentage of households is plotted on the x-axis, the percentage of income on the y-axis. It can also be used to show distribution of assets. In such use, many economists consider it to be a measure of social inequality.
See also
- Distribution (economics)
- Distribution of wealth
- Welfare economics
- Income inequality metrics
- Gini coefficient
- Hoover index (a.k.a. Robin Hood index)
- ROC analysis
- Social welfare (political science)
- Economic inequality
- Zipf's law
- Pareto distribution
- Mean deviation
