Education and inequality in income distribution

Abstract

This paper investigates the relationship between education and income inequality using data from 5,565 Brazilian cities. An education composite index combining 24 key indicators was constructed and calculated for each city. Income inequality was measured by the Gini index. The analysis was controlled for mean per capita household income. The results have shown that the education index increases with increasing income, but decreases with increasing inequality. Reduction of 0.1 in the Gini index is equivalent to increasing income by 17%.