Income inequality in Faroe Islands lower than in neighboring countries

Income inequality in the Faroe Islands is lower than in neighboring countries, according to recent data.

The Gini coefficient, which measures income distribution within a country, ranges from 0 to 100, with values closer to zero indicating a more equal income distribution in society. In the Faroe Islands, the Gini coefficient was measured at 22.2 in 2022, a slight increase from 21.5 in 2021.

A Gini coefficient of 22.2 indicates that income inequality is less pronounced in the Faroe Islands than in many other nations. For comparison, Denmark has a Gini coefficient of 28, while the EU’s average is 30. Greenland exhibits an even higher inequality with a Gini coefficient of 35. In Norway and Sweden, the figures are also 28.

This data suggests that household incomes in the Faroe Islands are more evenly distributed compared to the countries typically used for comparison, according to statistics from Hagstovan.

Another measure of income distribution is the quintile ratio, which looks at the income levels of the highest and lowest earners. In the Faroe Islands, the top 20% of earners make three times more than the bottom 20%. In 2021, this ratio was 2.9 times larger.