Question

Distinguish between positive and relative measures of inequalities. Explain the computational device of Gini ratio as measure of income inequality.

30 Aug 2025
Answer :
Word Count : 592
Positive and relative measures of inequalities are two distinct approaches to quantifying the differences in income, wealth, or other economic variables among individuals or groups within a population. Positive measures focus on the absolute magnitude of inequality, giving a direct representation of the differences in economic outcomes. They quantify how far apart individuals or groups are from each other in terms of income or wealth without normalizing for the average level of the variable in the population. For example, the range, which is the difference between the highest and lowest incomes, or the mean absolute deviation from the mean, are considered positive measures because they express inequality in the same units as the variable itself. These measures are intuitive and easy to interpret but can be sensitive to the scale of the variable and may not provide a comparable basis across populations with different average incomes. In contrast, ______ _____ _________ ____ ______ ___ ____ ________.
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