FACT BRIEF

Is income inequality in the US among the highest in the developed world?

Saturday, February 6, 2021

By Stevie Rosignol-Cortez

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YES

According to the most commonly used measure of income inequality, the Gini coefficient, the U.S. has one of the highest rates of income inequality in the developed world.

The Gini coefficient uses a country’s income distribution data to assign it a number between 0 and 1, with zero representing perfect equality and 1 representing perfect inequality.

The Organization for Economic Cooperation and Development tracks Gini coefficient data on its 37 member countries. Using each country’s latest available data—ranging from 2016-2019—the OECD found that the U.S. has the fourth-highest income inequality among OECD countries, behind Mexico, Chile and Costa Rica. Among G-20 countries, only Mexico has higher income inequality than the U.S.

The Pew Research Center reported in 2020 that income inequality in the U.S. has risen steadily since the 1980s, increasing by 39% between 1980 and 2018.

This fact brief is responsive to conversations such as this one.

Sources

Investopedia Investopedia: Gini index

Organization of Economic Cooperation and Development: Income inequality

Pew Social Trends: Trends in wealth and income inequality

World Bank: Income distribution index

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