The income distribution describes the distribution of the incomes on different restaurant subjects.

Overview

Applied to the income distribution of a population assistance of this diagram can be read off, how refer much per cent of the households like much per cent of the incomes. All households together (100%) refer altogether 100% of the gross income.

In order to determine a percentage of households and the associated portion of the gross income, one sorts the households ascending according to its income and sums up - beginning with the household with the smallest income - up to the given percentage, for example the lowest 10%, 20%, 30% etc. of the households. Then one sums up the incomes which were allotted to it and determines the portion of the gross income.

If one lays the associated portions on of the gross income over the portions of the households, then one receives the Lorenz curve as graph.

Two points are always fixed: 0% of the households have 0% of the income, and 100% of the households have naturally 100% of the income.

If all incomes are alike, then 10% of the households possess 10% of the gross income, 20% of the households possess 20% of the income, 30% possess 30% etc. to 100% possess 100%. If one lays these points on graphically, they are on a straight line with upward gradient 1 (the green straight line in the following illustration).

In practice it is rare that the subtotals are on a straight line. Often for example incomes are unequally distributed, whereby the graph is deviating a convex curve from the green straight line. The income differences of a society are the larger, the more strongly the curve of the straight line deviate.

The Ginikoeffizient for the income distribution is in Germany with 0,274 (2003), in France with 0,327 (1995), in Great Britain with 0,360 (1999), in Japan with 0,249 (1993) and in the USA about 0,408 (2000) (source: United nation human development report 2004). In the world-wide comparison Germany has one of the smallest unequal distributions (color in the accompanying map becomes green).

To the estimates of the United Nations it comes with a Gini coefficient above 0,40 to social unrests.

See in addition also list of the countries after income distribution

Personnel income distribution

Here one represents, how the available income of a national economy is distributed on individual persons and/or in particular - groups. Thus e.g. families, social classes, men and Mrs. etc.

Functional (or functional) income distribution

Here one represents, how the income distributes itself on the different factors of production of the economy. E.G.: Work, human and special capital, various kinds of capital etc.

Gross national income after income components

Here (see illustration) one represents, how the incomes distribute themselves functionally on the different factors of production.

• The gross national income is equivalent 100% set.
• The writings-off are not available as incomes. They are taken off, one receive:
• Net national income.
• Production and import duties are taken off from this less the subsidies. One receives:
• National income

This divides on in

• Enterprise and fortune income
• Employee payment

The Federal Statistical Office (StBA) divides the employee payment into:

• Social insurance contributions of the employers

Those remain

• Gross wages and - salaries

These divide on in

• Social insurance contributions of the employees
• Wage tax
• Net wages and - salaries

In the illustration the entrepreneur and fortune incomes are decreased by the "“direct taxes on the enterprise incomes"”, a size, which was calculated according to data of the StBA. In addition the StBA proves social insurance contributions of the entrepreneurs and the non--employed persons, who were likewise withdrawn from the enterprise incomes since 1991.

Temporal income distribution

Distribution of the income on current periods or later

Primary income distribution

• The primary income distribution is the distribution of the income by the direct production process. I.e. incomes from independent and dependent work.

• Computation of the ratios for the distribution of the national income

• Result is socially incompatible and/or unfair

Secondary income distribution

• Secondary income distribution the distribution is called, which results from national and private rearrangement. Are the center of attention here the fiscal policy and social security in addition, karitative organizations and families can to the rearrangement contribute. See also transfer incomes.

• Result leads to the available income, which should be socialcompatible. ("“fair"” income distribution)

Relevance

The income distribution is for the keeping of the social peace of importance. Strongly unequal distribution can lead to social unrests. At the same time a perfect uniform distribution is also not worthwhile after free market view, since then no incentive exists to furnish achievements.

In development assistance the direct income distribution is an important factor. In developing countries a large difference in the personnel income distribution is present.

See also

List of the countries after income distribution

Related links

• International income inequality
• Income distribution in Germany - a list and an analysis of the current income distribution in Germany.

Articles in category "Income distribution"

We found here 26 articles.