Wealth and Income Inequality

Country & Gini Mozambique Romania Norway

Index Score GI: 54.0 GI: 36.0 GI: 27.0
(World Rank) World Rank: 6 World Rank: 95 World Rank: 165

Population 30,888,034 21,230,362 5,509,591

WR: 46 WR: 60 WR: 117

Population growth 2.58% -0.38% 0.8%

rate WR: 15 WR: 221 WR: 123

Birth rate 38.03 births/1,000 population 8.39 births/1,000 population 12.09 births/1,000 population
WR: 10 WR: 215 WR: 158

Maternal mortality 289 deaths/100,000 live births 19 deaths/100,000 live births 2 deaths/100,000 live births
rate WR: 39 WR: 127 WR: 183

total: 63.03 deaths/1,000 live births total: 9.41 deaths/1,000 live births total: 2.34 deaths/1,000 live births
Infant mortality rate male: 65.06 deaths/1,000 live births male: 10.82 deaths/1,000 live births male: 2.68 deaths/1,000 live births
female: 60.94 deaths/1,000 live births female: 7.91 deaths/1,000 live births female: 1.98 deaths/1,000 live births
WR: 10 WR: 143 WR: 220

total population: 56.49 years total population: 76.3 years total population: 82.35 years
Life expectancy male: 55.09 years male: 72.88 years male: 80.21 years
female: 57.94 years female: 79.94 years female: 84.6 years
WR: 224 WR: 108 WR: 22

Physician density 0.08 physicians/1,000 population 2.98 physicians/1,000 population 2.92 physicians/1,000 population

HIV/AIDS adult 11.5% 0.1% 0.1%

prevalence rate WR: 7 WR: 132 WR: 130
Education 6.2% of GDP 3.3% of GDP 7.6% of GDP
expenditures WR: 29 WR: 137 WR: 14

Literacy (total) 60.7% 98.8% N/A

School life
expectancy (total) 10 years 14 years 18 years

Child labor- N/A N/A N/A

percentage

Suffrage 18 years of age 18 years of age 18 years of age

GDP-Per capita $1,200 $28,800 $63,600

(most recent year) WR: 224 WR: 67 WR: 13

Largest sector of
labor force agriculture: 74.4% services: 42.8% services: 78.6%
employment and
percentage
Unemployment rate 24.5% 3.06% 3.72%
(most recent year) WR: 197 WR: 41 WR: 54

Population below
poverty line 46.1% 23.8% 12.7%

Telephones-cellular 48.65 per 100 inhabitants 117.4 per 100 inhabitants 107.5 per 100 inhabitants
WR: 67 WR: 54 WR: 117

Debt- external $10.91 billion $117.829 billion $651.04 billion

WR: 112 WR: 50 WR: 21

Current Health
Expenditure 8.2% 5.6% 10.1%
 Income inequality refers to the unequal distribution of income throughout a population

that gives rise to a vast imbalance of wealth. A useful tool that was created to measure the

distribution of income across a population is the Gini index. Per the CIA Factbook, the Gini

index ranges from 0-100, 0 representing perfectly equal distribution, and 100 representing

perfectly unequal distribution. Not only does the Gini index provide insight to a country’s

equality status, but it also demonstrates the country’s standard of living—the level of comfort

and wealth available to a specific area. The more equal a country’s income distribution (the

lower the Gini index), the greater their standard of living since fewer people fall below the

poverty line. By reducing economic disparities, countries with greater income equality also

obtain greater socioeconomic mobility, providing minorities and marginalized groups equal

opportunities towards success. These opportunities can be found in many areas that promote

economic growth such as education, health, and overall human capital. By increasing

employment opportunities for those who would otherwise face discriminatory setbacks, poverty

rates would in turn decrease and the country’s standard of living would drastically improve.

After observing Mozambique (high income inequality), Romania (mediocre income

inequality), and Norway (low income inequality), an overall trend that ties high income

inequality to a low standard of living has certainly been found. According to the CIA Factbook,

the GDP per capita (average income earned per person in a given area) in 2020 was $1,200 for

Mozambique, $28,800 for Romania, and $63,600 for Norway. It is evident that the higher the

income inequality, the lower the country’s per capita gross domestic product (GDP). Since a

country’s GDP per capita is a significant indicator of its economic strength and stability, the fact

that Norway has an overwhelmingly larger GDP than Mozambique demonstrates how Norway is

not only more economically powerful than Mozambique, but its standard of living is also higher
since the average individual earns an exceptionally greater income, allowing for more money to

be spent to improve his or her life. In addition, it was found that 46.1% of Mozambique’s

population, 23.8% of Romania’s population, and 12.7% of Norway’s population is below the

poverty line. These statistics undoubtedly show how the more equal a country’s income

distribution is, the less their population falls below the poverty line. This indicates a greater

standard of living since less people are living in poverty due to the increase in opportunities for

equal healthcare, jobs, and education for all individuals, regardless of status, race, ethnicity, etc.

A noteworthy example of the increase in equal health benefits that is associated with

greater income equality is the fact that Norway has a physician density of 2.92 physicians per

1,000 of the population, while Mozambique has 0.08 physicians per 1,000 of the population.

Additionally, the average total life expectancy is about 56 years for Mozambique, 76 years for

Romania, and 82 years for Norway. As the distribution of income becomes more equal, it is

evident that the country experiences an increase in both available physicians and life expectancy,

indicating an increase in their standard of living since more individuals are receiving adequate

health care, leading to longer life spans.

As for education, Mozambique experiences a school life expectancy of 10 years,

Romania of 14 years, and Norway of 18 years. The decrease in school life expectancy that is

clearly occurring as income inequality rises is most likely due to a decrease in educational

opportunities such as colleges, or the ability to even finish high school in general. Not only does

this decline in proper education lower human capital, and in turn a country’s standard of living,

but it also leads to a decrease in employment opportunities due to the inability for those living in

poverty to meet the necessary requirements—demonstrated by Mozambique’s 24.5%

unemployment rate and Norway’s 3.72% unemployment rate. This proves how the lower the
country’s income distribution, the higher their unemployment rate is, largely due to the

inadequate education that is being offered to the people. As unemployment rates rise, standard of

living in turn decreases since more people fall into poverty and face greater difficulty at

obtaining comfort, goods, wealth, and necessities.

While the Gini index may seem like just a number, it is much more than that. Not only

does it reveal the extent of a country’s income equality, but it also indicates the standard of living

that is experienced among its population. It is vital to take these factors into account when

examining a country’s economy to determine the necessary steps that must be taken in order for

making effective policy changes.

 References

Central Intelligence Agency. (2021, December 14). Mozambique. The World Factbook.

https://www.cia.gov/the-world-factbook/countries/mozambique

Central Intelligence Agency. (2021, December 14). Norway. The World Factbook.

https://www.cia.gov/the-world-factbook/countries/norway

Central Intelligence Agency. (2021, December 14). Romania. The World Factbook.

https://www.cia.gov/the-world-factbook/countries/romania

Fontinelle, A. (2021, November 29). Standard of living vs. quality of life: What's the difference?

Investopedia. https://www.investopedia.com/articles/financial-theory/08/standard-of-

living-quality-of-life.asp

Gale, a Cengage Company. (2021). Income inequality. Gale in Context: Opposing Viewpoints.

https://link.gale.com/apps/doc/MSXFTQ671495757/OVIC?u=lom_accessmich&sid=boo

kmark-OVIC&xid=2972f3cf

Smith, L. (2021, August 27). The Gini index: Measuring income distribution. Investopedia.

https://www.investopedia.com/articles/economics/08/gini-index.asp