EDUC264 Lecture 13: EDUC264 -Lectures 13 - Macquarie University
22 Aug 2018
School
Department
Course
Professor
EDUC264
• Gini coefficient: income inequality over time and between countries
• Value between zero and one: zero is perfect equality and one is perfect inequality.
• Sensitive to changes in the definition of income and to changes of median income
• Does not tell us about changes in the distribution of inequality between income groups, such as
the top and the bottom
• Income may not include non-cash benefits provided by governments
• Broad range of measures should be used to assess income inequality
• Australia:
• ABS Survey of Income and Housing every two years
• ‘Equivalised household disposable income’: market income + cash transfers – direct taxes
• S80/S20: income ratio for
those at top 20% of
income distribution
compared with those at
bottom 20% of income
distribution
Page 59 of 102
EDUC264
Page 60 of 102
• Share of national income
• Share of national income that goes to high, middle and low income earners
• Level and growth in income for particular income deciles (e.g. top and bottom 10%)
• Poverty rate
• Measures of income inequality do not necessarily illuminate changes in absolute income that is
required for a minimum standard of living
• Poverty rate is more concern for bottom end of income distribution
• We didn’t experience the TLC — ability to maintain income growth of 3% per annum
• While labor inequality is on the decline, all equality has been rising since 1990s
• Difficult to compare across counties
• Doesn’t look at absolute incomes — doesn't allow us to look at bottom-end of distribution
properly
• Hence, why we look at poverty rate
• Graph allows you to see the trend of poverty
• Median level of income — where most people are actually at
• Working poor — income that is below poverty line (less that 50% income)
• Very high in Australia for elderly — however we have the retirement scheme so it is a little
misleading
Document Summary
Page 59 of 102: share of national income, share of national income that goes to high, middle and low income earners, level and growth in income for particular income deciles (e. g. top and bottom 10%) Oecd at 3% per annum: however, overall income inequality has increased since mid 1990s due to top income earners has had strong gain in share of national income, similar patterns with other oecd countries. Education and income inequalities in the global context. Scarcity value of credentials (the more people have degrees, the lower the value) Education, jobs and income: link between education, skills, credentials, jobs is limited , too simplistic and embodies a far too instrumental and utilitarian view of training (acquisitive learning). Rather it is a social construct based on specific rules and compromises: does not explain the wage or income inequality problem, there are other factors : Educ264: minimum wage, high salaries at the top end, tax.
