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The Structure and Distribution of Household Wealth in Australia

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  • Bruce Headey

    ()
    (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne)

  • Mark Wooden

    ()
    (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne)

  • Gary Marks

    (The Australian Council for Educational Research (ACER))

Abstract

2002 saw the first large-scale survey of household wealth carried out in Australia since World War I. Conducted as part of the second wave of the Household, Income and Labour Dynamics in Australia (or HILDA) Survey, it covered all main components of asset portfolios and debts. This paper uses these data to provide an overview of the structure and distribution of household wealth in Australia, providing estimates of the mean and median levels of household wealth by type of asset or debt, and estimates of the degree of inequality of wealth holdings. The data confirm that wealth is very unequally distributed, with the bottom half of the distribution owning less than 10 per cent of total household net worth (assets less debts), while the wealthiest 10 per cent account for 45 per cent of total net worth. The paper also includes an analysis of the factors associated with household wealth that indicates that wealth is significantly related to a range of factors including age, country of birth, parental occupational status, education, marital status, working hours, income, self-reported savings behaviour, a willingness to take risks and even various lifestyle behaviours, such as smoking and alcohol consumption.

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Bibliographic Info

Paper provided by Melbourne Institute of Applied Economic and Social Research, The University of Melbourne in its series Melbourne Institute Working Paper Series with number wp2004n12.

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Length: 36 pages
Date of creation: Jul 2004
Date of revision:
Handle: RePEc:iae:iaewps:wp2004n12

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  1. Gary S. Becker & Kevin M. Murphy, 1986. "A Theory of Rational Addiction," University of Chicago - George G. Stigler Center for Study of Economy and State 41, Chicago - Center for Study of Economy and State.
  2. Barrett, Garry F, 2002. "The Effect of Alcohol Consumption on Earnings," The Economic Record, The Economic Society of Australia, vol. 78(240), pages 79-96, March.
  3. Piggott, John, 1984. "The Distribution of Wealth in Australia-A Survey," The Economic Record, The Economic Society of Australia, vol. 60(170), pages 252-65, September.
  4. A. W. Dilnot, 1990. "The Distribution and Composition of Personal Sector Wealth in Australia," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 23(1), pages 33-40.
  5. Juster, F. Thomas & Smith, James P. & Stafford, Frank, 1999. "The measurement and structure of household wealth," Labour Economics, Elsevier, vol. 6(2), pages 253-275, June.
  6. Mark Wooden & Simon Freidin & Nicole Watson, 2002. "The Household, Income and Labour Dynamics in Australia (HILDA)Survey: Wave 1," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 35(3), pages 339-348.
  7. Webster, Elizabeth, 2000. "The growth of enterprise intangible investment in Australia," Information Economics and Policy, Elsevier, vol. 12(1), pages 1-25, March.
  8. J. W. Nevile & N. A. Warren, 1984. "How Much Do We Know About Wealth Distribution in Australia?," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 17(4), pages 23-33.
  9. van Ours, Jan C., 2004. "A pint a day raises a man's pay; but smoking blows that gain away," Journal of Health Economics, Elsevier, vol. 23(5), pages 863-886, September.
  10. Phillip B. Levine & Tara Gustafson & Ann D. Velenchik, 1997. "More bad news for smokers? The effects of cigarette smoking on wages," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 50(3), pages 493-509, April.
  11. Nicole Watson & Mark Wooden, 2004. "Sample Attrition in the HILDA Survey," Australian Journal of Labour Economics (AJLE), Bankwest Curtin Economics Centre (BCEC), Curtin Business School, vol. 7(2), pages 293-308, June.
  12. N. Podder & N. C. Kakwani, 1976. "Distribution Of Wealth In Australia," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 22(1), pages 75-92, 03.
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Cited by:
  1. Deborah A. Cobb-Clark & Vincent Hildebrand, 2009. "Portfolio Allocation in the Face of a Means-Tested Public Pension," Social and Economic Dimensions of an Aging Population Research Papers 260, McMaster University.
  2. Bruce Headey & Mark Wooden, 2004. "The Effects of Wealth and Income on Subjective Well-Being and Ill-Being," The Economic Record, The Economic Society of Australia, vol. 80(s1), pages S24-S33, 09.
  3. Simon Anastasiadis, 2010. "Health and Wealth," Treasury Working Paper Series 10/01, New Zealand Treasury.
  4. Andrew C. Worthington, 2009. "Household Asset Portfolio Diversification: Evidence from the Household, Income and Labour Dynamics in Australia (HILDA) Survey," Discussion Papers in Finance finance:200908, Griffith University, Department of Accounting, Finance and Economics.
  5. James B. Davies & Susanna Sandstrom & Anthony Shorrocks & Edward N. Wolff, 2009. "The Level and Distribution of Global Household Wealth," University of Western Ontario, Economic Policy Research Institute Working Papers 20091, University of Western Ontario, Economic Policy Research Institute.
  6. Debajyoti Chakrabarty & Hajime Katayama & Hanna Maslen, 2008. "Why Do the Rich Save More? A Theory and Australian Evidence," The Economic Record, The Economic Society of Australia, vol. 84(s1), pages S32-S44, 09.
  7. Bruce Headey, 2008. "Poverty Is Low Consumption and Low Wealth, Not Just Low Income," Social Indicators Research, Springer, vol. 89(1), pages 23-39, October.
  8. Cobb-Clark, Deborah A. & Hildebrand, Vincent A., 2008. "The Asset Portfolios of Native-Born and Foreign-Born Households," IZA Discussion Papers 3304, Institute for the Study of Labor (IZA).
  9. James Giesecke & G.A.Meagher, 2006. "Modelling the Economic Impacts of Migration and Population Growth," Centre of Policy Studies/IMPACT Centre Working Papers g-157, Victoria University, Centre of Policy Studies/IMPACT Centre.
  10. John Freebairn, 2005. "A Comparison of Alternative Tax Bases," Melbourne Institute Working Paper Series wp2005n11, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
  11. Drago, Robert & Black, David & Wooden, Mark, 2004. "Female Breadwinner Families: Their Existence, Persistence and Sources," IZA Discussion Papers 1308, Institute for the Study of Labor (IZA).
  12. Jefferson, Therese & Taplin, Ross, 2012. "Relational aspects of decisions to sell," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 41(5), pages 697-704.

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