Economics for People
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​DISTRIBUTION OF INCOME & WEALTH

Image courtesy of: Michael Leunig Appreciation Page

In this topic you will learn to:

​Examine economic issues
​

• investigate recent trends in the distribution of income in Australia and identify the impact of specific economic policies on this distribution
• analyse the economic and social costs of inequality in the distribution of income
​

Apply economic skills

• interpret a Lorenz curve and a Gini coefficient for the distribution of income in an economy
​

You will learn about:

Distribution of income and wealth
• measurement – Lorenz curve and Gini coefficient
• sources of income as a percentage of household income
• taxation, transfer payments and other assistance
• sources of wealth
• dimensions and trends, according to gender, age, occupation, ethnic background and family structure
• economic and social costs and benefits of inequality

What questions can you expect?

past_hsc_income___wealth_questions.docx
File Size: 84 kb
File Type: docx
Download File

Why look at this?

Click on the image below to hear what Bruce Pascoe has to say about growth and how an indigenous perspective could create more sustainable economic policies.
​
Picture
Picture
Turn and talk:
Inequality in Australia is more unequal than the majority of OECD nations, but is more equal than the US or UK.

​What is Bruce Pascoe suggesting would help us become more equal?

What  is this graph saying?

Picture
The Decline of Upward Mobility in One Chart Published August 26, 2020 By Marcus Lu
Could an End to World Poverty be near?

Click on the button to find out!

A major challenge for governments is to ensure that wealth and economic opportunity is distributed evenly across sectors and groups throughout an economy. Factors such as age, gender, ethnicity and geography can affect the distribution of wealth and income, but it is sluggish wage growth that has been a sticking point for workers for a number of years, and coupled with the Coronacession, inequality is growing.

What is the Gini Co-efficient?

Definition of Income inequality
​
Ref: OECD (2021), Income inequality (indicator). doi: 10.1787/459aa7f1-en (Accessed on 28 March 2021)
Income is defined as household disposable income in a particular year. It consists of earnings, self-employment and capital income and public cash transfers; income taxes and social security contributions paid by households are deducted. The income of the household is attributed to each of its members, with an adjustment to reflect differences in needs for households of different sizes. Income inequality among individuals is measured here by five indicators. The Gini coefficient is based on the comparison of cumulative proportions of the population against cumulative proportions of income they receive, and it ranges between 0 in the case of perfect equality and 1 in the case of perfect inequality. S80/S20 is the ratio of the average income of the 20% richest to the 20% poorest; P90/P10 is the ratio of the upper bound value of the ninth decile (i.e. the 10% of people with highest income) to that of the first decile; P90/P50 of the upper bound value of the ninth decile to the median income; and P50/P10 of median income to the upper bound value of the first decile. The Palma ratio is the share of all income received by the 10% people with highest disposable income divided by the share of all income received by the 40% people with the lowest disposable income.



​OECD (2021), Income inequality (indicator). doi: 10.1787/459aa7f1-en (Accessed on 28 March 2021)
CLICK on the image below. In this project you will:
  • draw Lorenz curves 
  • calculate and interpret the Gini coefficient 
  • interpret alternative measures of income inequality 
  • research other dimensions of inequality and how they are measured.
Picture

More resources available. Download the file and follow the links.

income___wealth_resources.pdf
File Size: 539 kb
File Type: pdf
Download File

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  • Home
  • Assessment
    • Y11
    • Y12
  • FOR TEACHERS
  • Preliminary
    • THE ECONOMICS OF EVERYTHING >
      • WEEK 1
      • WEEK 2
      • WEEK 3
      • WEEK 4
      • WEEK 5
      • WEEK 6
      • WEEK 7
      • WEEK 8
      • WEEK 9
      • WEEK 10
      • WEEK 11
    • CURIOUS CHOICES >
      • WEEK 1
      • WEEK 2
      • WEEK 3
      • WEEK 4
      • WEEK 5
      • WEEK 6
      • WEEK 7
      • WEEK 8
      • WEEK 9
      • WEEK 10
    • THE WORLD IS NOT FLAT >
      • WEEK 1
      • WEEK 2
      • WEEK 3
      • WEEK 4
      • WEEK 5
      • WEEK 6
    • TO INFINITY AND BEYOND >
      • LABOUR MARKET INSTITUTIONS
  • HSC
    • THE GLOBAL ECONOMY >
      • INTEGRATION
      • TRADE
      • ECO DEVELOPMENT
    • AUSTRALIA'S PLACE IN THE GLOBAL ECONOMY >
      • AUS TRADE & FIN FLOWS
      • EXCHANGE RATES
      • PROTECTION IN AUS
    • ECONOMIC ISSUES >
      • ECONOMIC GROWTH
      • UNEMPLOYMENT
      • INFLATION
      • EXTERNAL STABILITY
      • INCOME & WEALTH
      • ENVIRONMENT
    • ECO POL & MMENT >
      • OBJECTIVES
      • FISCAL POLICY
      • MONETARY POLICY
      • MICRO POLICIES
      • LABOUR MKT POLICIES
      • ENVIRONMENTAL POLICY
      • LIMITATIONS
  • Contact