page_title: Poverty in Canada
section_title: Gini coefficient
hierarchical_section_title: Poverty in Canada / Poverty measurement in Canada / Gini coefficient
caption_attribution_description: English: Differences in national income equality around the world as measured by the national Gini coefficient. The Gini coefficient is a number between 0 and 1, where 0 corresponds with perfect equality (where everyone has the same income) and 1 corresponds with perfect inequality (where one person has all the income, and everyone else has zero income).
context_page_description: Poverty in Canada refers to people that do not have "enough income to purchase a specific basket of goods and services in their community."
  Canada's official poverty line was re-defined in 2018 based on the Market Basket Measure. An alternative measure for poverty, the Low Income Measure, defined as household after-tax income below half of the median after-tax income, was reported at 13.0% in 2017.
  The number of people living below the official poverty line decreased substantially from 12.1% in 2013 to 9.5% in 2017.
  A February 2020 Statistics Canada report, that is based on 2018 income tax returns, says that 3.2 million Canadians were living below the poverty line.
context_section_description: The Gini coefficient is a measure of statistical dispersion most prominently used as a measure of inequality of income distribution or inequality of wealth distribution. It is defined as a ratio with values between 0 and 1: the numerator is the area between the Lorenz curve of the distribution and the uniform distribution line; the denominator is the area under the uniform distribution line. Thus, a low Gini coefficient indicates more equal income or wealth distribution, while a high Gini coefficient indicates more unequal distribution. 0 corresponds to perfect equality (everyone having exactly the same income) and 1 corresponds to perfect inequality (where one person has all the income, while everyone else has zero income). The Gini coefficient requires that no one have a negative net income or wealth.
  Serious consideration of the Gini coefficient for public policy implications is rare in Canada. Discussion of income inequality in the Canadian media generally implies that income inequality should be continually reduced as an objective, whereas international economists evaluating Gini coefficients generally focus on the idea of targeting an optimal range for the Gini coefficient. Some researchers have suggested the optimal Gini coefficient range is about .25-.40 (Wolfgang Kitterer, 2006, More Growth through Redistribution?). As of 2017, the Gini coefficient for Canada was estimated to be 0.31 on an after-tax basis (basically stable since 2014).
caption: Gini coefficient, income distribution by country.
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