The Times Australia
The Times World News

.
The Times Real Estate

.

Unequal? Our analysis suggests Australia is a more equal society than has been thought

  • Written by Roger Wilkins, Professorial Fellow and Deputy Director (Research), HILDA Survey, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne
Unequal? Our analysis suggests Australia is a more equal society than has been thought

It has long been known that incomes in Australia are more evenly distributed than in the United States.

But Australia has been thought to be a less equal society than many European ones, sitting somewhere in the middle between the United States and countries such as France.

We can measure income equality using the so-called Gini coefficient[1], which gives a score of 0 to a country in which incomes are completely evenly distributed and a score of 1 to a country in which one person has all the income.

The OECD gives the US a score of 0.375, Australia a score of 0.32[2] and France a score of 0.29.

But we’ve done work using a broader measure of income[3] that incorporates all taxes paid, all company profits and (importantly) in-kind benefits such as health and education. And we’ve found the positions of Australia and France are reversed.

The US has an even less equal distribution of incomes under this measure (0.49 compared to 0.375), France a somewhat less changed distribution (0.33 compared to 0.29), and Australia a more equal distribution (0.28 compared to 0.32), making Australia the most equal country of the three in terms of income broadly defined.

We can show this in another way, comparing the share of broadly defined national income going to the top 10% of income earners.

On this measure, the US is easily the least equal of the three, with high earners getting 39% of national income. In Australia and France they get about 25%.

The US is also the least equal of the three, with Australia and France almost tied, when comparing the share of broadly defined income going to the bottom 50%.

In Australia and France, the bottom 50% get the most, at around 29%. In the US, the least, at 19%

We used a method pioneered by researchers in the US and Europe[4] that combines household survey data, administrative tax data and national accounts data to create what are known as distributional national accounts[5].

Compared with previous measures of inequality, it fully accounts for the effects of Australia’s system of in-kind government provision of services such as health and education, all company profits (including those not paid out as dividends) and all taxes including income tax, company tax and the goods and services tax.

Although we find Australian incomes are much more evenly distributed than previously thought, they have gotten less equal in the past three decades.

Since 1991, the average incomes of Australia’s top 1% – and the top 0.1% in particular – have grown far faster than the average incomes of the bottom 90%.

Read more: Who gets what? Who pays for it? How incomes, taxes and benefits work out for Australians[6]

We also find a persistent gender gap in incomes, even when we account for income sharing in households, and for government spending on education, health, housing and social programs. Broadly measured, female economic wellbeing remains below that of males.

Our approach, described in full in our paper[7] and guided by previous studies for France[8] and the US, leaves room for refinement.

But it is enough to make clear that standard measures that leave out components of income and don’t account for taxes and benefits don’t tell the full story.

References

  1. ^ Gini coefficient (corporatefinanceinstitute.com)
  2. ^ 0.32 (data.oecd.org)
  3. ^ broader measure of income (docs.iza.org)
  4. ^ Europe (www.aeaweb.org)
  5. ^ distributional national accounts (wid.world)
  6. ^ Who gets what? Who pays for it? How incomes, taxes and benefits work out for Australians (theconversation.com)
  7. ^ paper (docs.iza.org)
  8. ^ France (doi.org)

Read more https://theconversation.com/unequal-our-analysis-suggests-australia-is-a-more-equal-society-than-has-been-thought-202950

The Times Features

Understanding the Dangers of Ignoring a Gas Leak

Gas leaks are silent threats lurking within both homes and workplaces. A gas leak occurs when natural gas or any other gaseous substance escapes from a pipeline or containment. T...

Can You Sell Your House Privately in Queensland? Here’s How

Selling a house privately in Queensland is entirely possible and can be a cost-effective alternative to using a real estate agent. While agents provide valuable expertise, their co...

Itinerary to Maximize Your Two-Week Adventure in Vietnam and Cambodia

Two weeks may not seem like much, but it’s just the right time for travelers to explore the best of Vietnam and Cambodia. From the bustling streets of Hanoi to the magnificent te...

How to Protect Your Garden Trees from Wind Damage in Australia

In Australia's expansive landscape, garden trees hold noteworthy significance. They not only enhance the aesthetic appeal of our homes but also play an integral role in the local...

Brisbane Homeowners Warned: Non-Compliant Flexible Hoses Pose High Flood Risk

As a homeowner in Brisbane, when you think of the potential for flood damage to your home, you probably think of weather events. But you should know that there may be a tickin...

Argan Oil-Infused Moroccanoil Shampoo: Nourish and Revitalize Your Hair

Are you ready to transform your hair from dull and lifeless to vibrant and full of life? Look no further than the luxurious embrace of Argan Oil-Infused Moroccanoil Shampoo! In a...

Times Magazine

"Eternal Nurture" by Cara Barilla: A Timeless Collection of Wisdom and Healing

Renowned Sydney-born author and educator Cara Barilla has released her latest book, Eternal Nurture, a profound collection of inspirational quotes designed to support mindfulness, emotional healing, and personal growth. With a deep commitment to ...

How AI-Driven SEO Enhancements Can Improve Headless CMS Content Visibility

Whereas SEO (search engine optimization) is critical in the digital landscape for making connections to content, much of it is still done manually keyword research, metatags, final tweaks at publication requiring a human element that takes extensiv...

Crypto Expert John Fenga Reveals How Blockchain is Revolutionising Charity

One of the most persistent challenges in the charity sector is trust. Donors often wonder whether their contributions are being used effectively or if overhead costs consume a significant portion. Traditional fundraising methods can be opaque, with...

Navigating Parenting Arrangements in Australia: A Legal Guide for Parents

Understanding Parenting Arrangements in Australia. Child custody disputes are often one of the most emotionally charged aspects of separation or divorce. Parents naturally want what is best for their children, but the legal process of determining ...

Blocky Adventures: A Minecraft Movie Celebration for Your Wrist

The Minecraft movie is almost here—and it’s time to get excited! With the film set to hit theaters on April 4, 2025, fans have a brand-new reason to celebrate. To honor the upcoming blockbuster, watchfaces.co has released a special Minecraft-inspir...

The Ultimate Guide to Apple Watch Faces & Trending Wallpapers

In today’s digital world, personalization is everything. Your smartwatch isn’t just a timepiece—it’s an extension of your style. Thanks to innovative third-party developers, customizing your Apple Watch has reached new heights with stunning designs...

LayBy Shopping