To determine the Gini coefficient for a given dataset, you can follow these steps:
- Calculate the cumulative distribution of the dataset.
- Calculate the Lorenz curve by plotting the cumulative distribution against the perfect equality line.
- Calculate the area between the Lorenz curve and the perfect equality line.
- Divide this area by the total area under the perfect equality line to get the Gini coefficient.
The Gini coefficient ranges from 0 (perfect equality) to 1 (perfect inequality).
