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5 countries with the widest gaps between rich and poor

24/7 Wall St. Logo By Michael B. Sauter of 24/7 Wall St. | Slide 2 of 6: An elderly Israeli woman walks past closed fruit and vegetable stands in the Mahane Yehuda outdoor market in Jerusalem March 23, 2006.

5. Israel

> Gini index – post tax & transfer: 0.377

> Social spending, pct. of GDP: 15.5% (4th lowest)

> Chg. in Gini after tax & transfer: 0.103 (5th smallest)

> Poverty rate: 20.9% (2nd highest)

Even in countries with more conservative structures, taxes and transfers usually mitigate income inequality somewhat. In Israel, the Gini score fell from 0.481 to 0.377. However, they did not have nearly as much of an equaling effect as in other countries. In fact, the country ranked 16th-least equal before taxes and transfers and fifth-least equal after taxes and transfers. Income inequality means poverty rates are certain to be higher, and that appears to be true in Israel as well. More than 20% of the country’s population lived below the poverty line, the second worst rate in the OECD. Higher educational achievement may help reduce the country’s income inequality. Just 15% of the country’s 25-64 year olds had failed to achieve at least the equivalent of a high school diploma, compared to an average 23.46% across the OECD.

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