Definition
Shows the percentage of the total aggregate household income that is held by each of the five income quintiles. For example, it might show that the lowest 20% of households earn only 3% of the total income, while the highest 20% earn 50%.
Why It Matters
This metric provides a powerful insight into the concentration of wealth and the degree of income inequality within a population. It reveals how much of the total economic pie each segment of the population controls, beyond just where their income falls.
Specific Relevance for Professionals:
Marketers
Provides a deeper understanding of market dynamics beyond simple income brackets. If the top quintile holds a disproportionately large share of income, it suggests opportunities for premium or luxury goods and services, even if the median income is moderate.
Researchers
Fundamental for advanced studies of income inequality, wealth concentration, and economic justice. It is a key tool for analyzing the distribution of economic resources and the impact of policies on different income strata.
Consultants
Crucial for economic development strategies and advising clients on investment in areas with particular income distribution patterns. It helps in assessing the economic landscape and potential for market segmentation based on wealth concentration.
Public Policy Workers
A vital metric for analyzing economic disparity and informing policies aimed at wealth redistribution, social equity, and economic justice. It highlights where economic resources are concentrated and where interventions might be needed to address inequality.
