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Palma Ratio

The Palma ratio is a measure of income inequality that compares the income share of the top 10% of a population to the income share of the bottom 40%. It is named after the economist Gabriel Palma, who developed the measure in a 2011 paper.

The Palma ratio is often used as an alternative to the Gini coefficient, which is a more widely used measure of income inequality. The Palma ratio is considered by some to be a more reliable measure of inequality because it focuses on the income share of the top and bottom segments of the population, rather than the entire distribution of income.