Income inequality in Faroe Islands lower than in Denmark, Greenland, Norway, and Sweden

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

The Gini coefficient is a measure used to describe income distribution in a country. A value closer to zero indicates a more equal distribution of income within society. In the Faroe Islands, the Gini coefficient was recorded at 22.2 in 2022, up from 21.5 in 2021.

A Gini coefficient of 22.2 reveals that income is distributed more evenly in the Faroe Islands compared to many other nations. For comparison, Denmark has a Gini coefficient of 28, the European Union has a coefficient of 30, while Greenland’s is at 35. Norway and Sweden both also stand at 28.

This data highlights that household incomes in the Faroe Islands are more evenly distributed than in countries with which they are typically compared, as noted by the Statistics Faroe Islands.

Another measure used to describe income distribution is the fifth percentile ratio. In the Faroe Islands, the income of the top fifth of earners is three times greater than that of the bottom fifth. This ratio was 2.9 times greater in 2021, indicating a significant disparity but still showing less inequality relative to other countries.