What is income inequality? Income inequality is the disparity or gap between the rich and the poor. It is usually measured by the Gini Coefficient index. This index ranges between 0 and 1. Where the Gini Coefficient is 0 the income levels between the poor and the rich is equal. This means that both the rich and the poor earn roughly the same amount of money. On the other hand, a Gini Coefficient of above 0 and closer to 1 shows higher disparities between the rich and the poor. A coefficient of 1 in this case depicts the highest level of income inequality. - See more at: http://www.customwritingservice.org/blog/an-outlook-on-the-effects-of-incomeinequality- in-asia/

1. Effects of Income Inequality in Asia
- See more at: http://www.customwritingservice.org/blog/an-outlook-on-the-effects-of-income-
inequality-in-asia/
What is income inequality?
Income inequality is the disparity or gap between the rich and the poor. It is usually measured by
the Gini Coefficient index. This index ranges between 0 and 1. Where the Gini Coefficient is 0
the income levels between the poor and the rich is equal. This means that both the rich and the
poor earn roughly the same amount of money. On the other hand, a Gini Coefficient of above 0
and closer to 1 shows higher disparities between the rich and the poor. A coefficient of 1 in this
case depicts the highest level of income inequality.
Income inequality is a very important measure in showing the human conditions of different
countries because it impacts on economic and developmental issues of every country. In most
cases, development banks and the World Bank often take time research on the level of income
inequalities in different countries.
What is the level of income inequality in Asia?

2. Effects of Income Inequality in Asia
Asia has experienced high rates of economic growth in the past decade. In fact, Asian countries
such as India Singapore and China have become economic giants and are now competing with
the developed countries in international markets. Despite this tremendous performance in
economic growth, income inequality has gone up and there are very high levels of disparities
between the rich and the poor of Asia.
The Gini coefficient of China for instance has risen dramatically from around 0.36 during the
1990s to an average of 0.46 in 2000s. In fact, the Asian Development Bank Reports show that
20% of the richest in China now earn 9 times more than 20% of the poorest Chinese citizens.
Countries like Nepal, Cambodia, India, Indonesia, Malaysia, Thailand and majority of Asian
countries have also experienced a rise in the levels of income inequality. Only Vietnam and the
Philippines have experienced lower income inequality while in countries like Bangladesh, there
has been less change in terms of income inequality.
Social effects of income inequality in Asia
Income inequality in Asia has had a major impact on the access and distribution of social
amenities to the citizenry of Asian countries. For instance access to proper health care and basic
necessities such as water, food and shelter has been a major hurdle for the poor. The rich on the
other hand have full access to such necessities.
In addition to this, the gap between the poor and the rich has also impacted on education because
most poor people have little or no access to good education in Asian countries. This has largely
perpetuated the vicious cycle of income inequality with majority of those with good income
being well educated and skilled.

3. Poverty levels have also risen due to the unequal distribution of resources and income. This has
led to unrests in countries like Thailand and Nepal where the citizens have demonstrated against
the huge gaps between the rich and the poor and accused governments of favoring the rich.
Economic effects of income inequality in Asia
The biggest economic impact of income inequality is the ris3e of unemployment. Since most
white collar jobs are the better paying, the poor, uneducated and unskilled laborers can hardly
compete with the rich who have good education and skills. The fact that these poor form the
majority of the population makes it difficult for any quick interventions to be implemented.
Additionally, the disparities in income distribution have led to neglect of important industries
such as agricultural industry. Majority of the populace has migrated to the urban centers in
search of work in factories hence building the manufacturing industry at the expense of rural
based agricultural industries.
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References
http://www.ft.com/cms/s/0/e8bca4ec-bf29-11e3-a4af-00144feabdc0.html#axzz385Y9Ovs9
http://inequalitywatch.eu/spip.php?article121
http://www.economist.com/node/9616888
http://blog.mpettis.com/2014/03/economic-consequences-of-income-inequality/
http://en.wikipedia.org/wiki/Economic_inequality
- See more at: http://www.customwritingservice.org/blog/an-outlook-on-the-effects-of-income-
inequality-in-asia/