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Lorenz Curve and Gini Coefficient #python
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import numpy as np | |
import matplotlib.pyplot as plt | |
# ensure your arr is sorted from lowest to highest values first! | |
arr = np.array([1,4,6,9,100]) | |
def gini(arr): | |
count = arr.size | |
coefficient = 2 / count | |
indexes = np.arange(1, count + 1) | |
weighted_sum = (indexes * arr).sum() | |
total = arr.sum() | |
constant = (count + 1) / count | |
return coefficient * weighted_sum / total - constant | |
def lorenz(arr): | |
# this divides the prefix sum by the total sum | |
# this ensures all the values are between 0 and 1.0 | |
scaled_prefix_sum = arr.cumsum() / arr.sum() | |
# this prepends the 0 value (because 0% of all people have 0% of all wealth) | |
return np.insert(scaled_prefix_sum, 0, 0) | |
# show the gini index! | |
print(gini(arr)) | |
lorenz_curve = lorenz(arr) | |
# we need the X values to be between 0.0 to 1.0 | |
plt.plot(np.linspace(0.0, 1.0, lorenz_curve.size), lorenz_curve) | |
# plot the straight line perfect equality curve | |
plt.plot([0,1], [0,1]) | |
plt.show() |
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