Assessing Economic Inequality Through the Lorenz Curve in Central and Eastern European Countries

Abstract

This study analyses economic inequality in Central and Eastern Europe (CEE) using tools such as the Lorenz Curve and the Gini coefficient. Originating in 1905, the Lorenz Curve, conceptualized by Max O. Lorenz, serves as an essential tool in illustrating income distribution, complemented by the Gini coefficient for assessing numerical inequality. Examining a decade of data from eleven CEE countries through Eurostat, the study constructs Lorenz curves, providing a visual and quantitative description of variations in income distribution. Percentile analysis reveals nuanced disparities, providing insight into the evolution of inequality. Methodologically, the study addresses the challenges, recognizing the advantages of the Lorenz curve in detailed information on income distribution, but also its disadvantages in data sensitivity. The findings show that the Lorenz curve and the Gini coefficient work synergistically, providing a comprehensive overview of economic inequality in CEE.

Keywords

• economic inequality
• lorenz curve
• gini coefficient
• inequality analysis
• income distribution