Wednesday, December 5, 2012

How unequal?

Quote One:

“We were one of the most unequal societies in the western road according to the OCED, during the boom years. The most, … , only two or three countries …”

Really?  In the OCED’s ‘mid-2000s’ table of Gini coefficients Ireland ranked 22 out of 30 countries.   This data is taken from Growing Unequal?: Income Distribution and Poverty in OECD Countries, released in 2008.

OCED Income Inequality

New Zealand, the UK, Italy, Poland, the US, Portugal, Turkey and Mexico all had higher rates of income inequality than Ireland.  Ireland was in the bottom half but there were eight countries with higher gini coefficients, not “two or three”.

Quote Two:

“2008 we were much worse than the EU average”

Really?  This is a table of Gini coefficients based on the 2008 EU-SILC (page 97).  Ireland’s gini coefficient of 29.9 was below the average for each of the EU-27, EU-15 and Eurozone countries.

2008 EU SILC Gini

Ireland ranked 15 out of the EU-27.  All of Bulgaria, Germany, Estonia, Greece, Spain, Italy, Latvia, Lithuania, Poland, Portugal, Romania and the UK had higher Gini coefficients (more income inequality) than Ireland.  Ireland was not “much worse” than the EU average.

Quote Three:

“Are you surprised then at how little we do about it [inequality]?

Really?  This is from the same 2008 OECD report which provided the data used above.  Which country had the third best reduction in the Gini coefficient (reduction in income inequality) from the mid-1980s to the mid-2000s?

Trends in Income Inequality

Yes, IRL = Ireland.

The final graph is from Chapter 16 of a Eurostat report based on the 2007 EU-SILC.  Which country had a system of direct taxes and cash benefits which had the second largest impact on reducing income inequality.

Figure 16.2

In a related table it can be seen that Ireland’s cash transfers reduced the Gini coefficient on original income of 47.2 (the highest in the EU) to 37.7 for gross income (the seventh highest in the EU), while Ireland’s direct taxes further reduced that to 32.4 (the eighth highest in the EU).  These reductions are reflected in the above graph.


  1. That Vincent may have been wrong about Ireland's relative wealth and its Gini Coefficient in 2008 doesn't alter the fact that we are particularly unequal now and getting more so -

    1. Michael,

      The CSO have announced that the 2010 EU-SILC data is being investigated by them for "unexplained anomalies" and that the 2010 data is subject to revision. The data was due to be released on the 12th of Decemeber but that has been pushed back (again) and no indicative date has been provided. They give no indication as to what this revision might entail so I think we just have to hold off on making conclusions based on the 2010 data just yet.