First explain what the Gini coefficient is and what hypothetical Gini values of 0 and 1 mean. Sort the data by the Gini coefficient in 2000 and look at the list of countries. Next describe the distribution of inequality across countries with a histogram and with text. Report the average Gini coefficient in 2000 and the standard deviation for all the countries in the data. Plot a scatter plot of Gini coefficients on GDP growth between 1970 and 2000, where growth is on the X-axis and gini00 is on the Y-axis. To do this, you'll have to create a new variable for this growth rate.
Then, explain the Kuznets hypothesis. What does the theory predict? Next produce a scatterplot using data from the year 2000 to determine whether the evidence in that year is consistent with the theory. (Hint: to produce this graph use the "lowess" command instead of the "scatter" command that we usually use). Does the hypothesis appear to be corroborated by the data? Explain your reasoning fully.