Book Review by 50Minutes

Author:50Minutes
Language: eng
Format: epub
Publisher: 50Minutes.com
Published: 2017-05-19T00:00:00+00:00

Inequality in the 20th century

In the third part of the work, Piketty uses a new tool, different from the capital/income ratio, to study the evolution of inequality over time: the inter-decile ratio. Based on a classic method of statistics, this ratio gives us a simple indicator allowing us to compare the difference between the highest and lowest salaries.

Good to know

A decile is a statistical value that corresponds to 10% of a given population. Thus, if we divide the population in question so that they are grouped by salary, the first decile represents the maximum salary of the poorest 10% and separates them from the rest of the population: 10% have less than the first decile, 90% have more. Each decile is therefore equivalent to the salary that separates a group of 10% from the following group. By extension, percentiles divide the population into groups of 1% and per-mille divide it into groups of 0.1%.

The inter-decile ratio consists of comparing two deciles, generally the first and last, in order to compare the difference in level between them.

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