Wednesday, November 20, 2013

Accumulative Line Graph or Lorenz Curve


Source: http://ingrimayne.com/econ/AllocatingRationing/MeasuringIncomeDist.html

Accumulative Line Graphs, or Lorenz Curves, show distribution. It can show distribution of things such as income and wealth. I have included a Lorenz Curve which show the distribution of income. It compares the percentage of income to the percentage of households. The blue line represents the line of equality- where 10% of households would be making 10% of the income and so on.  The Lorenz curve shows where the distribution is- in this case less than 60% of the households making 20% of the income.

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