This question requires you to analyze the dataset "world-ec.csv". The unit of observation is the nation-state. The variables are per capita Gross Domestic Product (purchasing power parity terms, 2010) and the last recorded Gini Coeffcient for the country. (The Gini Coeffcient is a measure of income inequality. It measures the degree of departure from a completely equal income distribution, on a scale of 0 to 100. Larger values correspond to more inequality.)
(a) Summarize the Gini Coeffcient variable: What are the mean, median, and standard deviation?
(b) Construct a histogram of the Gini Coeffcient. Locate the United States on the histogram (i.e., note the bin in which the U.S. falls).
(c) Compared to other countries in the world, does the U.S. have more or less income inequality than average, as measured by Gini? Use the standard deviation of Gini Coeffcients to determine whether the U.S. is relatively far away from the average or not.
(d) Summarize the per capita GDP variable: What are the mean, median, and standard deviation?
(e) Construct a histogram of per capita GDP. Locate the United States on the histogram (i.e., note the bin in which the U.S. falls).
(f) Compared to other countries in the world, does the U.S. higher or lower per capita GDP than average? Use the standard deviation of per capita GDP to determine whether the U.S. is relatively far away from the average or not.
(g) Some scholars have argued that income inequality is economically beneficial, in the sense that it generates incentives for vigorous economic activity. The idea is that in polities that ensure relatively equal incomes, individuals have less incentive to exert themselves economically than in polities where income inequality is more pronounced. Run a regression of per capita GDP on the Gini Coeffcient to assess the relationship between economic output and income inequality across countries. Report the regression line and R2 and interpret the results.
Note: Please find the Excel sheets attached along with this document.
Additional Requirement
These questions based on the Statistics and it is about finding Gini Coefficient in countries. Variables such as per capita GDP and income inequality are measured. Mean, median, standard deviation and regression have been calculated in the solution.
Word limit 350