Opinion – Australia – Chartbook of Economic Inequality – Max Roser

Oxford researcher, Max Roser, presents stunningly clear graphical data on trends inequality. Today, I’m focusing on Australia, where the charts present powerful evidence of increasing inequality.

Source: Australia – Chartbook of Economic Inequality

The main highlights include:

  1. Top decile of earnings has increased from 175 per cent of median in 1975 to 215 per cent in 2012.
  2. Gini coefficient (measuring inequality) has increased by 5 percentage points since 1981.
  3. Overall inequality and top shares fell from early 1950s to end of the 1970s.
  4. Poverty has been rising since 1981.
  5. The top gross income shares fell from 1921 to around 1980 and then began to rise, reaching pre-war levels before the 2007 crisis. The share in total wealth of the wealthiest 1% of the population dropped more than threefold from 1915 to the end of 1970s before rising again till the onset of 2007 crisis. However, the rise was not sufficient to return to pre-war levels of concentration..
  6. Rising inequality on all (observable) dimensions for past thirty years.

The website have been compiled by Anthony B Atkinson and Salvatore Morelli and are published as Atkinson and Morelli (2014). The online version of the Chartbook and the online data visualisations have been designed and constructed by Max Roser. The authors acknowledge support from the following institutions: Programme for Economic Modelling · Institute for New Economic Thinking – Oxford · Oxford Martin School

The authors explain their measures of income inequality.

It is interesting to reflect on the implications. Most people would cite the loss of traditional jobs, with man’s output increasingly being replaced by machines and jobs being offshored to low cost countries. BUT this needs to be considered against recent research from the IMF that better educational attainment and greater investment in R&D is significant in US states achieving higher Total Factor Productivity.

Personally, I was a little surprised that inequality in Australia followed similar trends in the US and the UK (open links for analysis of the US & the UK).

Thoughts?

Opinion – Australia tests system to weigh cattle using ‘groundbreaking’ satellite technology | The Japan Times – John Gelmini

Dr Alf is right and the Australians need to embrace technology in this way, as they are ultimately going to become the food producer of choice for the Far East, which means their agricultural methods have to be cutting-edge.

The young must embrace technology and find ways to develop linear income and businesses that will sustain them in the world where 50% of conventional American jobs and 75% of most other jobs in other countries will have vanished permanently by 2033.

Politicians are not yet sharing projections for massive increase in unemployment for obvious reasons. BUT young people at an individual level need to prepare themselves to be competitive in tomorrow’s world.

John Gelmini