Trends in the distribution of income
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Trends in the distribution of income

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By Paul McKenzie

By Paul McKenzie

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    Trends in the distribution of income Trends in the distribution of income Presentation Transcript

    • Trends in the distribution of income and wealth (BEST SLIDESHOW)
    • Income
      • Personal income is the amount of funds or other benefits, measured in money terms, that flow to individuals or households for the sale of factors of production (usually over a period of time).
      • For ease, assume that a high income will lead to a high level of wealth.
    • Wealth
      • Wealth refers to the value of the stock of assets held by an individual at a particular point in time.
      • Wealth inequality is harder to measure than income inequality and is generally more unequal as it cannot be redistributed.
    • Inequality in income and wealth distribution
      • Some groups in society are affected by inequality more than others, depending on:
        • Age and Qualifications
        • Gender and Occupation
        • Ethnic and Cultural background
        • Family type
        • Location.
    • This graph highlights the extent of income inequality in Australia, with the majority of the population experiencing average weekly incomes between $200 to $1200. However, well over half the population experience incomes less than the mean income of $644 per week demonstrating that a relatively small number of households have relatively high incomes, while a large number of households have relatively low incomes.
      • This graph highlights the extent of wealth inequality in Australia, and that wealth is more unevenly distributed than income. More than half of households have a net worth less than the mean $563,000 however, household wealth has become more even over the last few years.
    • Age and Education
      • Income varies over the course of life. It is highest between the ages 25 and 59, generally increasing between those ages. Wealth follows a similar pattern - rising for mot of their lifetime, and falling in the 60-64 years age group.
      • Obviously, people with more education and experience will hold higher-paying jobs, and thus, have higher levels of income and wealth.
    • Gender and Occupation
      • Gender also impacts income distribution with males, on average, experiencing higher incomes than females. In 2005-06 (ABS statistics) females earned an average weekly income 65.5% that of males, with only a slight improvement in equality over the last decade.
    • Ethnic and Cultural background
      • English speaking migrants tend to have higher incomes than those born in Australia, as their skills are often in high demand and will greatly benefit the economy, while non-English speaking migrants face the opposite situation.
    • Family Structure As suspected, 2003-04 ABS statistics, revealed that Couples without dependant children experienced the highest income and wealth levels ($506 and $402,326 respectively) followed by couples with dependant children, single persons and single parents ($336 and $62,923).
    • Location
      • Income and wealth inequality is present between Australia’s states and territories and also between major cities, regional and remote areas.
      • Distribution of income between states/territories is fairly even, however the ACT is well above the national average. Regional areas experience significantly lower levels of income than remote areas and major cities.