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Understanding New Zealand s Changing Income Distribution 1983 98:A Semiparametric Analysis

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  • Dean R. Hyslop
  • David C. Maré

Abstract

This paper analyses changes in the distribution of equivalised gross household income and income inequality in New Zealand between 1983 and 1998. We analyse the distributional effects of changes in household structure, National Superannuation (old age pension), household socio- demographic attributes and employment outcomes, and in the economic returns to such attributes and employment outcomes, using a semiparametric kernel density approach, and assess the impact of these factors on alternative summary measures of inequality over the period. We find that changes in household structure and in the socio-demographic characteristics of households are the main factors contributing to the rise in inequality, while the large changes in the employment outcomes had a more modest impact, and there is little evidence of systematic effects of changes in the economic returns. The results are qualitatively robust to a variety of equivalisation, income, and weighting measures.

Suggested Citation

  • Dean R. Hyslop & David C. Maré, 2004. "Understanding New Zealand s Changing Income Distribution 1983 98:A Semiparametric Analysis," Microeconomics 0402014, EconWPA.
  • Handle: RePEc:wpa:wuwpmi:0402014 Note: Type of Document - pdf; prepared on Word 2000; to print on pc;
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    File URL: http://econwpa.repec.org/eps/mic/papers/0402/0402014.pdf
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    References listed on IDEAS

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    1. Lars Osberg, 1998. "Economic Insecurity," Discussion Papers 0088, University of New South Wales, Social Policy Research Centre.
    2. Des O'Dea, 2000. "The Changes in New Zealand's Income Distribution," Treasury Working Paper Series 00/13, New Zealand Treasury.
    3. Jenkins, S., 1988. "The Measurement Of Economic Inequality," Papers 170, Australian National University - Department of Economics.
    4. Jenkins, Stephen P & Cowell, Frank A, 1994. "Parametric Equivalence Scales and Scale Relativities," Economic Journal, Royal Economic Society, vol. 104(425), pages 891-900, July.
    5. Danziger, Sheldon & Taussig, Michael K, 1979. "The Income Unit and the Anatomy of Income Distribution," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 25(4), pages 365-375, December.
    6. Mary C. Daly & Robert G. Valletta, 2000. "Inequality and poverty in the United States: the effects of changing family behavior and rising wage dispersion," Working Paper Series 2000-06, Federal Reserve Bank of San Francisco.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Arthur Grimes & Andrew Aitken, 2004. "What's the Beef with House Prices? Economic Shocks and Local Housing Markets," Working Papers 04_08, Motu Economic and Public Policy Research.
    2. Deborah A. Cobb-Clark & Vincent A. Hildebrand, 2006. "The Wealth of Mexican Americans," Journal of Human Resources, University of Wisconsin Press, vol. 41(4).
    3. Grimes, Arthur, 2005. "Regional and industry cycles in Australasia: Implications for a common currency," Journal of Asian Economics, Elsevier, vol. 16(3), pages 380-397, June.
    4. Arthur Grimes, 2005. "Intra & Inter-Regional Industry Shocks: A New Metric with an Application to Australasian Currency Union," Macroeconomics 0509019, EconWPA.
    5. Francisco Ferreira, 2010. "Distributions in motion: Economic growth, inequality, and poverty dynamics," Working Papers 183, ECINEQ, Society for the Study of Economic Inequality.
    6. Arthur Grimes, 2004. "New Zealand: A Typical Australasian Ecomony?," Working Papers 04_11, Motu Economic and Public Policy Research.
    7. Michelle Poland & David C Maré, 2005. "Defining Geographic Communities," Urban/Regional 0509016, EconWPA.
    8. Suzi Kerr & Kit Rutherford, 2008. "Nutrient Trading in Lake Rotorua: Determining Net Nutrient Inputs," Working Papers 08_03, Motu Economic and Public Policy Research.
    9. David C Maré, 2005. "Indirect Effects of Active Labour Market Policies," HEW 0509004, EconWPA.

    More about this item

    Keywords

    Household income distribution; Inequality; Kernel density estimation;

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • I30 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General

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