Income inequality refers to the relative gap between individuals or households in terms of their respective income or standard of living. It is measured by the Gini coefficient which is a statistic used to represent the inequality among values of a frequency distribution, with values ranging from 0 (perfect equality) to 1 (perfect inequality). While various factors such as ethnicity, place of residence, education level and gender all play a role in determining one’s level of income, income inequality more generally reflects the unequal distribution of economic resources, such as access to education, job opportunities, and health and social services.

See also: wealth inequality, economic system, financial system, economic growth