Income Equality

This sub-indicator measures pre-tax national income share held by the top 10 percentile group divided by the pre-tax national income share held by the bottom 50 percentile group. Pre-tax national income is the sum of all pre-tax personal income flows accruing to the owners of the production factors, labour and capital, before taking into account the operation of the tax/transfer system, but after taking into account the operation of pension system. The central difference between personal factor income and pre-tax income is the treatment of pensions, which are counted on a contribution basis by factor income and on a distribution basis by pre-tax income. The population is comprised of individuals over age 20. The base unit is the individual (rather than the household) but resources are split equally within couples.