Income and wealth inequality

Bank notes

Income and wealth inequality are issues in Scotland and the UK. Although most people would agree that society should aim to be more equal, complete equality within a capitalist society is not possible.

Arguably, what matters more is the extent of inequality, ie the size of the inequality gap between the most affluent and least affluent. Some political commentators argue that should the inequality gap become too wide this may result in an increase in social unrest.

Income is generally understood to cover a person’s earnings from their employment, dividends from shares and stocks, pension payments etc.

Wealth includes income but also the total value of a person’s assets, eg housing, personal possessions such as artwork or jewellery, money in the bank, the value of stocks and shares, etc.

The Gini coefficient attempts to measure income inequality within a society and to allow comparisons between countries. Depending on which way statistics are presented, the nearer a country is to zero the lower the level of inequality.

For example, a zero (0) Gini coefficient rating represents perfect income equality where everyone's income is equal. On the other hand, the nearer a country comes to one the greater the income inequality.