Final answer:
The incorrect statement about the Gini coefficient is that it measures absolute income or wealth. In reality, it is a relative indicator of income or wealth inequality, which doesn't reflect individual economic growth or variety in consumption.
Step-by-step explanation:
The Gini coefficient is a measure of income or wealth inequality within a nation or a group of people. A common misconception is that the Gini coefficient directly measures absolute wealth or income levels; however, it is actually a relative measure that does not reflect average income or economic growth directly. For instance, it does not account for how the rich relative to the poor may be getting richer over time, nor does it analyze whether the economic conditions for the average person are improving in absolute terms.
It is not true that the Gini coefficient can measure how economic growth is distributed across different groups within society. While a rising GDP per capita might suggest that the economy is growing, it does not provide information on wealth distribution or whether the rise is shared equally among the populace. Similarly, the Gini coefficient does not consider factors such as cultural variety or product diversity; it strictly focuses on the distribution of income or wealth within a society.
Thus, the statement that is not true about the Gini coefficient is that it is an absolute measure of income.