Median Household Income Overview
The indicator refers to the median income of a household in a country. Median household income divides households into two equal segments, such that the first half earns less than the median income while the second half earns more. The median income is defined in PPP (Purchasing Power Parity, in Current International Dollars) terms to avoid exchange rate fluctuations due to inflationary tendencies across countries. The median income level is generally accepted as a better indication of well-being or actual income distribution as it is not skewed by disproportionate data.
According to Global Data, the top ten countries with the highest median household income in the world are Singapore, Iceland, Norway, Sweden, Ireland, Luxembourg, Belgium, the United States, Cyprus, and Australia. The average median household income (PPP) was $40,094 in 2021.
Norway Median Household Income Highlights in 2021
Norway’s median household income (PPP) hit $76,852 in 2021, an increase of 0.8% over the previous year. Between 2010 to 2021, Norway’s median household income increased by 20.9%.
Norway scored 0.77, which is higher than the average for the Europe and Central Asia region and high-income countries. The country have a healthy economy, with strong socialist traditions in terms of equitable income distribution and generous welfare spending. The country has high living standards and a high cost of living. Norway's Gini coefficient of equivalized disposable income in 2019 (where zero corresponds to perfect equality, while 100 corresponds to perfect inequality) was 25.4, according to Eurostat. Whereas the Gini coefficient before social transfers, such as pensions, stood at 51% in 2018. This indicates that the nation has an effective social transfer system. However, the rate of poverty among immigrants in Norway is much higher than that experienced by the native population, particularly among non-Westerners.
The real household consumption expenditure grew by 4.1% in 2021, compared to a contraction of 2% in the previous year. The growth in private consumption reflects the rising employment rate and wage growth. According to Global Data, the real household consumption expenditure is forecast to grow by 3.4% in 2022 and real GDP is projected to expand by 3.5% in 2022.
Recent trends influencing Global Economic Growth
Increased COVID-19 impact:
As a result of Omicron, a new variant of COVID-19, more cases have been reported worldwide, resulting in the disruption of supply chain management. However, the global vaccination drive has reduced the fatality rate from the coronavirus.
Rising Inflation and Interest Rates:
As a result of rising inflation rates in both developing and advanced economies, central banks have been forced to tighten monetary policy and raise interest rates to keep prices from rising. However, a steady increase in interest rates could cause financial distress in some economies.
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