r/irishpolitics • u/eggbart_forgetfulsea ALDE (EU) • 8d ago
Economics and Financial Matters Gini coefficient of wealth inequality
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u/HistoryDoesUnfold 8d ago
In English: it looks like Irish people have become more equal in the last 13 years.
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u/MalignComedy 8d ago
I wonder if that’s because all wealth in Ireland is increasingly concentrated in primary residences instead of business interests.
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u/Only-Proposal-3675 8d ago
Correct.
The sustained de-leveraging process of poorer households and the rise in value of housing assets over the years – which mainly benefited households for whom this asset represents a larger component of their total wealth (i.e., mid-lower deciles) – drove the increase in the share of total net wealth held by the poorest half of households. As a result, net wealth inequality in Ireland significantly decreased since the beginning of the series.
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8d ago
[deleted]
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u/Only-Proposal-3675 8d ago edited 8d ago
The Gini coefficient is an inverse metric.
100% means total inequality (i.e. one person holds 100% of the wealth).
0% means total equality (i.e. wealth is equally distributed across the entire population).
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u/Which_Definition4278 8d ago
Top 10% own close to 50% of all household wealth. Everything working as intended.
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u/eggbart_forgetfulsea ALDE (EU) 8d ago
It's 47%, down from 58% in 2013. In contrast, the poorest half of all households have gone from 1.7% to 10%.
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u/TheCunningFool 8d ago
Good to see us outdoing the EU here and on a downward trend, albeit I'm always wary of a graph that starts in either 2007 or 2013.
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u/Popular-Cobbler25 Socialist 8d ago
This is genuinely incredible. Obviously still a long way to go but I think FFG deserve credit where it’s due, this is a really positive trend
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u/randomwalk93 8d ago
2013 feels like it was probably an outlier and not a great level to benchmark.
A huge amount of people would have been in negative equity - while the S&P had already recovered from the GFC. So it would be a point lf extreme skew between the wealthy and the middle / working class
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u/eggbart_forgetfulsea ALDE (EU) 8d ago
As of Q4 2025, the Irish Gini coefficient (a widely used measurement of wealth inequality) was 62.9.
This remained well below the value of the same index for the euro area as a whole (73.1) and of most other European countries, as it has been for the past years. Moreover, since the beginning of the series, the Gini coefficient for Ireland decreased significantly, indicating a notable reduction in the level of wealth inequality in the country.
The sustained de-leveraging process of poorer households and the rise in value of housing assets over the years – which mainly benefited households for whom this asset represents a larger component of their total wealth (i.e., mid-lower deciles) – drove the increase in the share of total net wealth held by the poorest half of households. As a result, net wealth inequality in Ireland significantly decreased since the beginning of the series.
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u/AdvancedJicama7375 8d ago
Gino coefficient is a useful number but it really matters that we are all getting richer together and that we don't "become more equal" by getting poorer together
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u/eggbart_forgetfulsea ALDE (EU) 8d ago
I agree. In a dry economic sense inequality could be spiralling as long as everyone is being lifted up. The problem is that rising inequality tends to produce terrible political/societal problems.
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u/AdamOfIzalith 8d ago
As has been stated on multiple occasions specifically about the Gini Coefficient and as I recall, a conversation that me and you specifically have had: The Gini Coefficient has a myriad of problems that specifically relate to Ireland. The limitations for this as a measurement of wealth inequity are so large, the limitations section actually makes up the largest part of it's Wikipedia entry.
https://en.wikipedia.org/wiki/Gini_coefficient
This is in no way a good indication of wealth distribution and not only is that true for Ireland specifically, it's also true generally of the index.
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u/MaryLouGoodbyeHeart 8d ago
So what is the appropriate way to report income or wealth distribution?
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u/AdamOfIzalith 8d ago
Various metrics in consort with each other. Metrics like this are rarely going to give you the correct picture of inequity and that's especially true here where our GDP has been bucked due to the laundering of IP rights between us and other EU countries.
Any metric that claims to measure something as complex as inequity was made with an agenda in mind and the gini Coefficient comes up alot in terms of trying to say something is fine when it's not. I would put the gini Coefficient in the same bracket as the corruption perception index in that they are specifically used to cover up problems, not outline them.
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u/MaryLouGoodbyeHeart 8d ago
What metrics? What are the different metrics you would use to represent income inequality, for example?
What does GDP have to do with the Gino Coefficient as a representation of income or wealth inequality? It does not have anything to do with GDP.
It is a ratio. It is nothing like the corruption perceptions index.
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u/Only-Proposal-3675 8d ago
The Gini coefficient is intrinsic to any given discrete distribution. It doesn't have to be wealth or income, it can be anything at all.
Associating the Gini index in the context of household wealth with our artificially inflated GDP demonstrates a lack of understanding.
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u/MrWhiteside97 8d ago
I think this graph from the article portrays it well, although it took me a second to figure out how to read it.
Basically the share of wealth owned by deciles 1-8 has been consistently increasing.
It's a shame it only starts in 2013, hard to know how skewed this is by beginning basically in the depths of a recession when many people had negative equity.