The Lorenz Curve in the Classroom

Abstract

The Lorenz curve and Gini index have great social relevance due to concerns regarding income inequality. However, their discussion is limited in the undergraduate statistics and mathematics curriculum. This article outlines how to increase the educational potential of Lorenz curves as an application in both the calculus class and introductory probability classroom. We show how calculus and probability techniques can be used to obtain not only the Gini index, but also a variety of other statistical measures from the Lorenz curve, provided the mean is known. The measures discussed include the median, and various measures of dispersion.

KEYWORDS:

• Gini index
• Robin Hood index
• Teaching
• Undergraduate education