Monday , September 26 2022

Caribbean Netherlands: income inequality lowest on Saba

Of the three Caribbean islands, Saba had the lowest income inequality in 2016. According to Statistics Netherlands (CBS), the distribution of incomes was most uneven on St Eustatius, whilst Bonaire was in the middle range.

The disparities in standardised disposable income – income adjusted for differences in household size and composition – have remained virtually unchanged on Bonaire since 2011.
Between 2014 and 2016, the Gini coefficient stood at 0.40, versus 0.39 in previous years. Saba has had the lowest income inequality of the three islands since 2012 (0.37 in 2016). The largest inequalities in standardised disposable income between households were recorded on St Eustatius, where the Gini coefficient rose from 0.41 in 2014 to 0.44 in 2016. The Gini coefficient for the European Netherlands decreased from 0.3 to 0.29 in this period.

Internationally, the Gini coefficient is the most frequently used instrument to measure income inequality. The value ranges between 0 (total equality; all households have the same income) and 1 (total inequality; one household has all the income).

The graph shows that, on Saba, the equality in disposable income is the highest of the BES islands.

Income inequality based on 80/20 ratio
According to the 80/20 ratio, indicating the relation between the highest 20 percent of incomes and the lowest 20 percent of incomes, Saba had the lowest income inequality in 2016 as well, with a value of 7.86. The highest value was measured on St Eustatius (13.51), with Bonaire occupying the middle ground (9.49).

Income distribution on Bonaire
In 2016, households on Bonaire had an average disposable income of 27.4 thousand US dollars. Standardised disposable income amounted to 22.6 thousand US dollars. At 18.5 thousand US dollars, the median income is lower than the average income.

Incomes between 10 and 15 thousand US dollars are most prevalent. Almost 20 percent of Bonaire’s households fall into this category. Within this group, nearly 4 out of 5 households had income from employment and over 1 in 5 were primarily dependent on benefits.

Incomes between 15 and 20 thousand US dollars were almost as prevalent as incomes between 10 and 15 thousand US dollars. Of those with incomes between 0 and 5 thousand US dollars, one half mainly had income from employment and the other half were mainly dependent on benefits.

There are not enough data available to present a similar chart for St Eustatius and Saba.

Disposable household income
Disposable household income is defined as gross income from labour, business activities, personal capital, social benefits and received transfers minus paid income transfers, contributions paid by employers, health care contributions and tax on income and personal capital.

Standardised disposable household income
The disposable household income adjusted for the differences in household size and composition. All incomes are reduced to the income of a one-person household using the OECD equivalence scale. In this way the prosperity levels of households have been made comparable. Therefore, standardised income can be used to measure the prosperity level of a household or its members.


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