Gini Coefficient (after Tax)

interactive website and API that the World Bank uses to share the estimates it produces in its activities of monitoring global poverty, inequality and shared prosperity.

Here we summarize some key aspects of the definitions and methods used in the platform’s data.

For a more detailed discussion, see the World Bank PIP methodology document.

Welfare measure

The data collated in the PIP data relates to a mix of after-tax income and consumption, depending on the country and year. While in most high-income countries, the data relates to after-tax income, in poorer countries, the data tends to relate to consumption.

The World Bank pools the data to get a global picture of poverty and inequality. But it’s essential to remember that, depending on the country or year, somewhat different things are being measured.

In the Data Explorers of the World Bank data above, we provide the option of plotting these after-tax income and consumption data points separately.

The World Bank PIP data provides no indicators in terms of before-tax income.

To make absolute comparisons of living standards across countries and over time, the World Bank converts the survey data – measured in local currencies at current prices – into constant international dollars. The World Bank data shown above is all measured in 2017 international dollars.

Primary data sources

The World Bank PIP estimates are derived from a large collection of household surveys.

In addition to the difference between income and consumption data mentioned above, there are several other ways in which comparability across household surveys can be limited, both across countries and over time. In collating this survey data, the World Bank takes various steps to harmonize it where possible, but comparability issues remain. The PIP Methodology Handbook provides a good summary of the comparability and data quality issues affecting this data and how it tries to address them.

To help communicate this limitation of the data, the World Bank produces a companion indicator that groups data points within each country into ‘spells’. The surveys underlying the data within a given spell for a particular country are considered by World Bank researchers to be more comparable. In the Data Explorers of the World Bank data above, we provide the option of plotting the data with the breaks between spells shown.