The distribution of economic wellbeing is generally regarded as one of the key performance indicators of a society and economic wellbeing is strongly influenced by income, wealth and consumption. Despite this, almost all studies of inequality in Australia have relied upon income as the sole measure of economic wellbeing, due in large part to the ready availability of income data. This thesis attempts to redress that deficiency. This thesis provides an insight into an under-researched but vitally important topic - the distribution of wealth. Specifically the research has three goals. The first is to provide estimates of the level and distribution of wealth in Australia at the current time and the trends over the past decade or two. The second aim is to provide projections of the future wealth distribution. The final goal is to see if there are significant differences between the distribution of lifetime wealth and the annual cross-sectional distribution of wealth. The research uses a technique not previously used in Australia to estimate wealth in the future - dynamic microsimulation. The microsimulation model used is based on a starting sample of 150,000 individuals and this large number allows a large range of experiences to be modelled, while not having the high costs, years of commitment and other problems associated with undertaking panel studies. This thesis estimates that the average levels of wealth will increase significantly over the 40-year period from 2000 to 2040 but that wealth inequality will increase over the same period. The reasons for the increases in wealth inequality appear to be due to changes in asset ownership, particularly lower levels of home ownership; the ageing population; and increases in inequality within age cohorts. The research found that lifetime wealth inequality for a sub-group of Generation X differed from the distribution based on annual data. The lifetime wealth inequality was significantly less than the annual wealth inequality.
|Date of Award||2003|
|Supervisor||Ann Harding (Supervisor)|