What is the Gini coefficient?
The Gini coefficient is a single number that summarizes how evenly (or unevenly) a quantity is distributed. It is most commonly used for income inequality, but the same idea works for wealth, sales across customers, workload across team members, or any other non-negative distribution.
A Gini value of 0 means perfect equality (everyone has the same amount). A value close to 1 means extreme concentration (one person or unit has almost everything).
How to interpret your result
Typical interpretation bands
- 0.00 to 0.20: Very equal distribution
- 0.21 to 0.35: Relatively equal to moderate inequality
- 0.36 to 0.50: Noticeable inequality
- 0.51 to 0.70: High inequality
- 0.71 to 1.00: Extreme concentration
These ranges are guidelines, not universal rules. Context matters: a Gini of 0.40 might be high in one domain and expected in another.
How this calculator computes Gini
This page uses the standard ranked formula. After sorting values from smallest to largest, it calculates:
G = (2 × Σ(i × xi) / (n × Σxi)) − (n + 1) / n
- n = number of values
- xi = each sorted value
- i = position in sorted order (1 through n)
If all values are zero, inequality is effectively zero for practical reporting here, so the calculator returns 0.
Example walkthrough
Suppose five households have incomes: 20, 25, 30, 35, and 190. Most households are clustered together, while one household is much higher. The calculator will return a relatively high Gini, showing that the distribution is concentrated.
Try clicking Load Example and then Calculate Gini to see the result instantly.
Common mistakes to avoid
- Mixing units: Keep all values in the same units (e.g., all monthly income, not monthly and annual mixed together).
- Using negative values without adjustment: Basic Gini formulas assume non-negative values.
- Too small a sample: Very few observations can make inequality seem unstable.
- Over-interpreting one number: Gini is a summary metric; pair it with median, mean, and distribution charts.
When should you use Gini vs. other metrics?
Use Gini when you need:
- A compact inequality score for comparison across groups or time
- A measure that responds to the full distribution, not only top or bottom segments
- A scale from 0 to 1 that stakeholders can understand quickly
Consider additional metrics when you need:
- Top-share focus: Use top 10% or top 1% share
- Poverty focus: Use poverty rates or lower-tail indicators
- Tail sensitivity: Use Theil index or Atkinson index
Final thoughts
Gini coefficient calculation is simple to run but powerful in insight. Whether you are evaluating income inequality, customer concentration, or resource allocation fairness, a reliable Gini calculator can help you move from intuition to measurable analysis.