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Income Inequality in Australia in an International Comparative Perspective

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  • Peter Saunders
  • Garry Hobbes

Abstract

Earlier comparative work on income distribution has tended to suggest that Australia is characterised by less income inequality than other industrialised economies. Concerns about the quality of the Australian data used in such comparisons have led to the need for more detailed assessment of the situation. The Luxembourg Income Study has been a focus for this work by bringing together microdata sets for a range of countries and reorganising them to conform to standardised concepts and definitions. This paper builds on earlier work undertaken as part of the Luxembourg Income Study by including Australia in an international comparative analysis of income distribution and redistribution. The Australian data are those from the 1981–82 Income and Housing Survey, with income tax imputed onto the data file. Results are presented for the gross and net income distributions between both families and individuals in seven countries. A common set of equivalence scales is also used to adjust for differing family needs. The results indicate that, using several summary measures of inequality, the distribution of income in Australia is less equal than in four of the other six countries studied. Earlier research which placed Australia high on the international league table of income equality is thus not confirmed by the results.

Suggested Citation

  • Peter Saunders & Garry Hobbes, 1988. "Income Inequality in Australia in an International Comparative Perspective," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 21(3), pages 25-34, September.
    • Handle: RePEc:bla:ausecr:v:21:y:1988:i:3:p:25-34
    DOI: 10.1111/j.1467-8462.1988.tb00551.x
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    References listed on IDEAS

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    1. Michael O'Higgins & Geoffrey Stephenson & Gunther Schmaus, 1985. "Income Distribution and Redistribution," LIS Working papers 3, LIS Cross-National Data Center in Luxembourg.
    2. Timothy Smeeding & Lee Rainwater & Gaston Schaber & Richard Hauser & Martin Rein, 1985. "Poverty in Major Industrialized Countries," LIS Working papers 2, LIS Cross-National Data Center in Luxembourg.
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    Cited by:

    1. Peter Saunders, 1998. "Using Budget Standards to Assess the Well-Being of Families," Discussion Papers 0093, University of New South Wales, Social Policy Research Centre.
    2. Anthony B. Atkinson & Andrew Leigh, 2007. "The Distribution of Top Incomes in Australia," The Economic Record, The Economic Society of Australia, vol. 83(262), pages 247-261, September.
    3. Peter Saunders & Cathy Thomson & Ceri Evans, 2000. "Social Change and Social Policy: Results from a Survey of Public Opinion," Discussion Papers 00106, University of New South Wales, Social Policy Research Centre.
    4. Tony Eardley & Peter Saunders & Ceri Evans, 2000. "Community Attitudes Towards Unemployment, Activity Testing and Mutual Obligation," Discussion Papers 00107, University of New South Wales, Social Policy Research Centre.
    5. Bruce Bradbury, 1999. "Tax Theory and Targeting: A Survey," Discussion Papers 00100, University of New South Wales, Social Policy Research Centre.

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