Palma Ratio Calculator
Palma ratio of independently enumerated richest10%/poorest40%income totals under matching sample/weight conventions. Not rank interpolation or s80/s20ratio; actual group assignment external.
Description
The Palma ratio compares income held by the top decile with income held by the bottom four deciles.
The Palma ratio compares income held by the top decile with income held by the bottom four deciles.1
The supplied group totals must come from a compatible ranked population definition.
When to use Palma Ratio Calculator
Use this tool to obtain observedPalmaRatio from the supplied records using the stated calculation. Establish the population, period, variable definitions, sample coverage and independently applicable instrument or calibration.
How to use Palma Ratio Calculator and understand its results
- Establish the population, period, variable definitions, sample coverage and independently applicable instrument or calibration.
- Enter callerVerifiedTopDecileIncomeTotal, callerVerifiedBottomFourDecilesIncomeTotal, using the field meanings and rules below, then run the tool.
- Read result.observedPalmaRatio. Use the units and sign conventions below, and review any unknown records separately.
- Correct any reported input issue and run again. Before using a successful result, check the stated units, signs, reference scope and observation coverage.
| Input field | Meaning | Value type | Requirement |
|---|---|---|---|
| callerVerifiedTopDecileIncomeTotal | Caller verified top decile income total | number | Required |
| callerVerifiedBottomFourDecilesIncomeTotal | Caller verified bottom four deciles income total | number | Required |
Require nonnegative top-decile total income and positive bottom-four-deciles total income on a common basis. Divide top by bottom; no percent conversion, sorting or quantile assignment is performed.
PalmaRatio=topDecileIncomeTotal/bottomFourDecilesIncomeTotal Use the matching field units and the exact boundary, ordering and reference rules above.
| Output field | Meaning | Value type |
|---|---|---|
| result | Calculated observation or qualified reference | object |
| result.observedPalmaRatio | Observed Palma Ratio | number |
{
"input": {
"callerVerifiedTopDecileIncomeTotal": 40,
"callerVerifiedBottomFourDecilesIncomeTotal": 20
},
"output": {
"result": {
"observedPalmaRatio": 2
}
}
}Limitations and assumptions
Population definitions, survey design, calibration and observation coverage are independently established. A result describes the supplied record or conditional model without demonstrating causation, validating an instrument or supplying representative population evidence.
Missing required fields, unknown fields, wrong types and violated rules return input issues. Numeric values and outputs must be finite. Extremely large composite outputs are rejected.
Alternative or Complementary methods
For a related step, use Theil Index Calculator: The Theil T index summarizes inequality relative to a sample's mean income. For a complementary comparison, use Reynolds-Smolensky Redistribution Effect Calculator: The Reynolds–Smolensky comparison subtracts post-tax inequality from pre-tax inequality.
References
-
Palma Ratio Calculator — tool.io
Similar or alternative tools
- Theil Index Calculator
The Theil T index summarizes inequality relative to a sample's mean income.
- Reynolds-Smolensky Redistribution Effect Calculator
The Reynolds–Smolensky comparison subtracts post-tax inequality from pre-tax inequality.