Aussie well-being unchanged despite rich getting richer
Australians seem to be less worried about income inequality and the top one per cent getting richer than most countries, according to research by Said Business School at the University of Oxford.
The working paper, "Top Incomes and Human Well-being Around the World", found a one per cent increase in the share of taxable income held by the top one per cent hurts life satisfaction as much as a 1.4 per cent increase in the country-level unemployment rate.
However, the research suggested that in Australia overall well-being remained the same and negativity was fairly low as national income inequality rose.
Commenting on the research, co-author Jan-Emmanuel De Neve, said "some theories suggest that, overall, inequality can be a good thing: individuals are motivated by seeing others accumulate wealth, as they believe they can do the same".
"While this may happen to a certain extent in some transitional or emerging economies, our research shows that, worldwide, income inequality at the very top makes us all less happy with our lives, even if we're relatively well-off," he said.
Co-author Nattavudh Powdthavee, said the research was started by asking if income inequality at the very top really matters to the life evaluation of the average person.
"… the results have shown conclusively that it does. Other studies have demonstrated the strong links between unhappiness and low productivity, the increase in sick leave and stress; policymakers may need to pay more attention to the wider consequences of the rising share of income the top one per cent enjoy," Pawdthavee said.
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