is used to help calculate the gini coefficient a primary mathematical mean of calculating inequality
may assist governments in making public policy changes or impacting tax bracket ranges based on incomemaintains anonymity of surveyed individualsmay be compiled to show how the curve has changed over timesample data may not appropriately reflect the overall population therefore displaying an incorrect lorenz curvemay require extensive data collection to adequately fill in the entire curvemay require estimation or preparer inference as to the curve to drawmay mislead analysts due to the varying shapes and sizes of the gini coefficient area different areas may be equal in size yet vary in appearancelorenz curve examplethe curve above shows a continuous lorenz curve that has been fitted to data that describes income distribution in brazil as of 2020 the data set is also compared to a straight diagonal line representing perfect equality at the 55th income percentile the value of the lorenz curve is 22 39 this means that the lorenz curve estimates that the bottom 55 of the population takes in 22 39 of the nation s total income if brazil were a perfectly equal society the bottom 55 would earn 55 of the total elsewhere we can see that the 99th percentile corresponds to 89 32 in cumulative income this means that the top 1 takes in 11 68 of brazil s income to find the approximate gini coefficient subtract the area beneath the lorenz curve around 0 25 from the area beneath the line of perfect equality 0 5 by definition divide the result by the area beneath the line of perfect equality which yields a coefficient of around 0 5 or 50 according to the world bank brazil s gini coefficient was 48 9 in 2020 4