This website uses cookies to ensure you have the best experience. Learn more

Income And Wealth Inequality In Australia

1209 words - 5 pages

Inequality is present in every economy, but to what extent are income and wealth in Australia unequal and what government polices contravene income and wealth inequality? Income is defined as money that an individual or business receives in exchange for providing a good or service or through investing capital, while wealth is a measure of the value of all of the assets of worth owned by a person, community, company or country.

Income and wealth inequality refers to the degree to which income is unevenly distributed among people in an economy. The share of total income received by different groups measures inequality, this visually represented in the Lorenz curve. The line of perfect ...view middle of the document...

320 while single parent households receive 0.245.

Wealth is measured as the net worth of households, in the ABS survey of “Household Wealth and Wealth Distribution 2011-12,” the average value of household wealth was $728,100, with median household wealth drastically lower at $434,000. This reveals that a relatively small proportion of households have high net worth and a large portion of households have low net worth, concluding with the simple statement that: The distribution of wealth is more unequal in Australia than the distribution of income.

The disparities accounted for in the distribution of wealth and income tends to reflect wealth that is accumulated during a person’s working life and utilised during retirement. Whilst this sources the foundation of inequality, the distribution of income in Australia is influenced by socio-economic factors such as gender, age, occupation and ethnicity. Gender is a common inconsistency in various economies, during 2013 average weekly earnings for males were $1516 while females earned $1250, this is still coherent for males and females in the same occupational categories, and is augmented for opposite genders in different occupational categories. In terms of ethnicity, it has been recorded that persons born overseas earn more than persons born in Australia, that non-English speaking backgrounds earn less than English speaking backgrounds and the period of residence in Australia is proportional to the income earned. However, the lowest income earners in the Australian community are Indigenous Australians and being heavily reliant on government welfare, earn a substantial loss in income compared to that of non-Indigenous Australians.

The Australian government employs two primary methods of redistributing income throughout an economy to influence income and wealth inequality. This is through a direct impact policy that involves government intervention to reduce income and wealth inequality via taxes and transfer payments. In the 2000s a tax policy was utilised to decline marginal taxation rates and raise the tax thresholds for low to middle income earners, following with the elevation of the tax free threshold for the first and second tax bracket in 2012-13.

The second method, which indirectly impacts inequality in an economy, is composed of economic restructuring when implementing a microeconomic reform. The purpose of restructuring is due to the increase of inequality and enhanced benefit to high-income earners when microeconomic reforms, such as the Australian Fair Work Act 2009, have been executed. This reform initiated 10 national criteria for employment, with the Fair Work Commission responsible for annual amendments to the National Minimum Wage, sustaining the real wages of low-income earners. A compulsory superannuation has also been introduced to provide...

Find Another Essay On Income and wealth Inequality in Australia

Gender Inequality in Australia Essay

834 words - 3 pages Almost 40 years ago, women were officially granted the rights to have equal pay for equal work in Australia, when The Equal Opportunity Act was passed. Despite this act, however, sex discrimination still occurs in Australia this day, as well as all over the world where it should be illegal. Women in workplaces are unfairly being put second-best to men, when they should be regarded equally. Gender inequality in the workplace is still occurring

Income Inequality in America and its Contributing Factors

2554 words - 11 pages and taxes are collected, we will continue to see poor remaining poor and wealthy remaining in wealth. Raise the taxes on the wealth and raise the wages then call on the government to build an even more balanced gap in order to avoid what was seen between 1970’s and the late 90’s. A positive outlook to income inequality is that it will allow our country to keep pushing forward to ensure that we can continue to build on the economy and strive to

A Look at Income and Educational Inequality in America

2917 words - 12 pages Rich vs. Poor:A Look at Income and Educational Inequality in AmericaEver since I can remember the importance of education has been made clear. My parents have always told me that I need to get good grades and go to a good college, like them, so I can make money and do the same for my kids and so on. I never stopped to think about how lucky I am that I am actually going to a University with what seems like, such economical ease. The fact of the

Income Inequality and Economic Development

2978 words - 12 pages also increases. It can be inferred that since the rich do save more, greater income inequality, where wealth is concentrated in the hands of a few, is better under the Solow growth model. Countries such as China, India, and South Korea to name a few, that have had high growth rate, have saved significantly more than the global average . Income inequality as measure by the Gini coefficient in these countries have also gone up (Asian Development Bank

The Distribution of Income and Wealth

969 words - 4 pages need for anyone to distribute their wealth. Socialists have their own distinctive ideas on how society should distribute wealth and income. Kai Nielson defends the idea that it is the duty of society to have equality of need fulfillment. Nielson believes that everyone has the right to an equal share of the wealth in the world and states that this should be applied globally. He goes on to say that if only a fraction of what the United States

Income Inequality in the United States

1043 words - 5 pages The highest earning fifth of U.S. families earned 59.1% of all income, while the richest earned 88.9% of all wealth. A big gap between the rich and poor is often associated with low social mobility, which contradicts the American ideal of equal opportunity. Levels of income inequality are higher than they have been in almost a century, the top one percent has a share of the national income of over 20 percent (Wilhelm). There are a variety of

Income Inequality in the United States

3442 words - 14 pages Income inequality not only harms us fiscally, but also affects our mental and physical wellbeing; therefore, it is important to identify the right ways to control wealth distribution among people. History Income inequality in the United States has increased and decreased throughout history, but in the recent years, the widening gap has become a serious issue. Income inequality is usually measured by Gini coefficient. According to this method

Income Inequality in the US is Growing

623 words - 3 pages Stiglitz explains the high level of inequality due to the fact that the top US income earners captured a majority of the income growth, widening the gap between them and the low-income earners. This income can be explained through the Heckscher-Ohlin model. The trade between US and poorer global economies causes more of a specialization in what the US is relatively endowed in, capital or skilled workers. This increases the production in capital

Income Inequality in the United States

4067 words - 16 pages those corporations that are wealthy create and pass legislation that will give them more wealth there is not only an increase of income inequality but also a decrease in democracy. Social Mobility As discussed previous there are many key factors that make a democracy function. One of these factors is mobility. Without mobility individuals in a democracy lack the ability to move within the economic system. Some research has shown that

The Government's Role In Income Inequality

784 words - 4 pages Income inequality has been a growing problem and is currently at its highest since 1928. Based on statistics, more jobs have wanted people with a college degree more than a person with a high school diploma. A worker with a college degree earns at least 80 percent more than a worker with a high school diploma. This factor has been increasing income inequality along with the changes of family structure. The income of a two-parent family is twice

Income Inequality and The Civil Rights Movement

1099 words - 5 pages Introduction The issue of income inequality is a crucial piece of your upcoming re-election campaign this fall. Similarly to the Civil Rights Movement and the War on Poverty in the 1960s, a high level of inequality can hamper social cooperation, encourage intra-elite competition, and ultimately during wartime, as illustrated in the Vietnam War, can further exasperate the American people’s frustrations with income inequality. Social Cooperation

Similar Essays

Inequality, Wealth And Income Essay

1222 words - 5 pages The issue of workplace inequality has been in the eyes of the public, and been in awareness of society for decades. Some of the most predominant issues which arise when speaking of workplace inequality include gender, attractiveness, and school prestige. It is proven that these three properties determine or differentiate ones workplace income in comparison to the income of a man, a beautiful woman, or a person who attended an average school. For

Trade And Income Inequality Essay

933 words - 4 pages As trade takes place, living conditions and economic growth must be the ultimate goal. Trade and economic growth that does not establish a reduction in poverty can generate problems that did not exist before. If rapid growth is accomplished at the expense of misdistribution of resources, then it will create social tensions or class warfare. Rapid growth has been shown in different countries that raises gap of income inequality and raise the

Inequality In Australia Essay

1243 words - 5 pages increase in poverty and ultimately the inequality gap between the low income earners and the high income earners. It is evident that although the line between inequality and equality are unlikely to meet it is important that individuals in society are receiving social justice. Works Cited The distribution of wealth in Australia by Frank Stilwell & David Primrose (2007) accessed on May

Tackling The Income Inequality And Promote Opportunity In The Us

1859 words - 8 pages dissatisfied with how the income and wealth are distributed (Gallup 2014). The same survey also stated that 69 per cent of American adults say that the government should do the work to reduce the gap between the richest and everyone else. This paper is about how the new elected US president should overcome the income inequality problem by issuing a sound and feasible public policy to be used in the administrative agenda for the next two years. The