How to interpret Theil?
The Theil index measures an entropic “distance” the population is away from the “ideal” egalitarian state of everyone having the same income. The numerical result is in terms of negative entropy so that a higher number indicates more order that is further away from the “ideal” of maximum disorder.
How is the Theil index calculated?
To compute Theil’s T statistic, we simply multiply a state’s population share (the state’s population / the total United States population), the quotient of a state’s average income and the national average income (average income in the state / average income in the United States), and the natural logarithm of the …
What does a high Theil index mean?
A high Theil index indicates the total income is not distributed evenly among individuals in the same way an uncompressed text file does not have a similar number of byte locations assigned to the available unique byte characters.
What is Palma ratio?
The Palma ratio is defined as the ratio of the richest 10% of the population’s share of gross national income divided by the poorest 40%’s share.
What does negative Theil index mean?
The Theil index measures an entropic “distance” the population is away from the egalitarian state of everyone having the same income. The numerical result is in terms of negative entropy so that a higher number indicates more order that is further away from the complete equality.
How do you interpret entropy index?
An Entropy Index measures the spatial distribution of multiple groups simultaneously. The maximum value for h is ln(k), or ln 3 = 1.10 • 0 * log (0) is defined as 0. Tracts with higher values of h are more diverse. A tract with h =1.10 would have equal proportions of all groups (33.3 % each).
What does a high Palma ratio mean?
The Palma Ratio When the bottom 40% of a population lose half their income, and the richest 10% get dibs, a sensible measure of income inequality should rise more than incrementally.
What is a high Palma ratio?
It is the ratio of the richest 10% of the population’s share of gross national income (GNI) divided by the poorest 40%’s share. Countries with the highest Palma Ratio (2015) Country.
What does the index of dissimilarity measure?
The most widely used measure of evenness is the dissimilarity index. Conceptually, dissimilarity measures the percentage of a group’s population that would have to change residence for each neighborhood to have the same percentage of that group as the metropolitan area overall.
What does a high dissimilarity index mean?
segregation
The index of dissimilarity is a demographic measure of the evenness with which two groups are distributed across component geographic areas that make up a larger area. The index of dissimilarity can be used as a measure of segregation.
What is generalized entropy measure?
The Generalized Entropy Index (GE) is a measure of inequality. A value of zero represents perfect equality and higher values denote increasing levels of inequality, within a mapped administrative unit.
How do you interpret Palma ratio?
The Palma ratio is a measure of inequality. It is the ratio of the richest 10% of the population’s share of gross national income (GNI) divided by the poorest 40%’s share.