Advanced Search
MyIDEAS: Login to save this paper or follow this series

The Changes in New Zealand's Income Distribution

Contents:

Author Info

  • Des O'Dea

    ()

Registered author(s):

    Abstract

    This paper summarises recent research on changes in New Zealand’s income distribution. It describes how the income distribution has changed during the period 1981 to 1996. It then looks at factors accounting for these changes in the income distribution. The main focus is on social trends, such as household composition, and changes in individual characteristics, such as age, qualifications and employment status. The first part of the paper looks at trends in the income distribution. This shows that income inequality rose in the 1980s and 1990s in New Zealand. The rate of growth was fastest in the 1980s. New Zealand’s level of income inequality has risen substantially relative to the levels in other OECD countries. Wellbeing measured in income terms depends not just on income at a given point in time, but also on the extent to which that income position persists through time. The second major part of this paper focuses on recent research on income ‘dynamics’. Analyses using tax data show that incomes do vary considerably from period to period. However, there is also a considerable degree of income ‘persistence’. The final part of the paper looks at factors contributing to the increase in income inequality. Changes in household composition, (such as the growth in sole parent households and older households without children), account for some of the increase in household income inequality. A growing proportion of workers in their prime earning years, and with higher educational qualifications, has also increased income inequality. These factors can explain up to 50-60% of the overall increase in income inequality.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://www.treasury.govt.nz/publications/research-policy/wp/2000/00-13/twp00-13.pdf
    Download Restriction: no

    Bibliographic Info

    Paper provided by New Zealand Treasury in its series Treasury Working Paper Series with number 00/13.

    as in new window
    Length: 113 pages
    Date of creation: 2000
    Date of revision:
    Handle: RePEc:nzt:nztwps:00/13

    Contact details of provider:
    Postal: New Zealand Treasury, PO Box 3724, Wellington, New Zealand
    Phone: +64-4-472 2733
    Fax: +64-4-473 0982
    Web page: http://www.treasury.govt.nz
    More information through EDIRC

    Related research

    Keywords:

    This paper has been announced in the following NEP Reports:

    References

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
    as in new window
    1. Atkinson, A. B. & Bourguignon, F. & Morrisson, C., 1988. "Earnings mobility," European Economic Review, Elsevier, vol. 32(2-3), pages 619-632, March.
    2. Mookherjee, Dilip & Shorrocks, Anthony F, 1982. "A Decomposition Analysis of the Trend in UK Income Inequality," Economic Journal, Royal Economic Society, vol. 92(368), pages 886-902, December.
    3. Shorrocks, A F, 1980. "The Class of Additively Decomposable Inequality Measures," Econometrica, Econometric Society, vol. 48(3), pages 613-25, April.
    4. Alan Deardorff & Ralph Lattimore, 1999. "Trade and factor market effects of New Zealand's reforms - revisited," New Zealand Economic Papers, Taylor & Francis Journals, vol. 33(2), pages 81-85.
    5. Robert Haveman & Lawrence Buron, 1994. "The Anatomy of Changing Male Earnings Inequality: An Empirical Exploration of Determinants," Economics Working Paper Archive wp_104, Levy Economics Institute.
    6. Aghion, Philippe & Caroli, Eve & García-Peñalosa, Cecilia, 1999. "Inequality and Economic Growth: The Perspective of the New Growth Theories," Scholarly Articles 12502063, Harvard University Department of Economics.
    7. Peter Gottschalk & Timothy M. Smeeding, 1997. "Cross-National Comparisons of Earnings and Income Inequality," Journal of Economic Literature, American Economic Association, vol. 35(2), pages 633-687, June.
    8. Gardiner, Karen & Hills, John, 1999. "Policy Implications of New Data on Income Mobility," Economic Journal, Royal Economic Society, vol. 109(453), pages F91-111, February.
    9. Jarvis, Sarah & Jenkins, Stephen P, 1998. "How Much Income Mobility Is There in Britain?," Economic Journal, Royal Economic Society, vol. 108(447), pages 428-43, March.
    10. Parker, Simon C, 1999. "The Inequality of Employment and Self-Employment Incomes: A Decomposition Analysis for the U.K," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 45(2), pages 263-74, June.
    11. Burtless, Gary, 1999. "Effects of growing wage disparities and changing family composition on the U.S. income distribution," European Economic Review, Elsevier, vol. 43(4-6), pages 853-865, April.
    12. Sen, Amartya, 1973. "On Economic Inequality," OUP Catalogue, Oxford University Press, number 9780198281931, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. NZ inequality statistics: Some of the research
      by Matt Nolan in The Invisible Hand in Economics on 2013-11-25 19:00:32
    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as in new window

    Cited by:
    1. The Treasury, 2001. "Geography and the Inclusive Economy: A Regional Perspective," Treasury Working Paper Series 01/17, New Zealand Treasury.
    2. Sholeh A. Maani & Rhema Vaithianathan & Barbara Wolfe, 2006. "Inequality and Health: Is Housing Crowding the Link?," Working Papers 06_09, Motu Economic and Public Policy Research.
    3. Dean R. Hyslop & David C. Maré, 2004. "Understanding New Zealand s Changing Income Distribution 1983 98:A Semiparametric Analysis," Microeconomics 0402014, EconWPA.
    4. Dean Hyslop & Dave Maré, 2001. "Understanding Changes in the Distribution of Household Incomes in New Zealand Between 1983-86 and 1995-98," Treasury Working Paper Series 01/21, New Zealand Treasury.
    5. Dean R. Hyslop & David C. Maré, 2003. "Understanding New Zealand's Changing Income Distribution 1983-98: A Semiparametric Analysis," Working Papers 03_16, Motu Economic and Public Policy Research.
    6. Ron Crawford & Grant Johnston, 2004. "Household incomes in New Zealand: The impact of the market, taxes and government spending, 1987/88–1997/98," Treasury Working Paper Series 04/20, New Zealand Treasury.

    Lists

    This item is featured on the following reading lists or Wikipedia pages:
    1. Social class in New Zealand in Wikipedia English ne '')

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:nzt:nztwps:00/13. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Web and Publishing Team, The Treasury).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.