Abstract
This study compares the work-life labour income of Indigenous and average Australians and assesses the potential effect of bridging the mortality gaps on their work-life earnings using a life-table model which took account of the survival, employment and income trajectories from 25 to 64 years. Age-specific employment and average annual income data were derived from the 2006 Census for three educational groups: incomplete secondary, completed secondary, and higher levels of education. Results show that depending on educational qualifications, the work-life labour income of Indigenous people is likely to be around two-fifths to two-thirds of the work-life labour income of average Australians. If Indigenous Australians were to have the same level of survival as average Australians, the work-life labour income gap would narrow by about 4–7 % points. Bridging the adult mortality gap alone has only a small effect on bridging economic gaps persisting between Indigenous and other Australians.
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Notes
‘Certificate or higher’ education is classified as Certificate I and higher non-school classifications as defined in the Australian Standard Classification of Education (ASCED); it also includes Certificate Level, not further defined (ABS 2006).
HILDA contains perhaps the most up-to-date information that identifies the Indigenous status of the respondents. Another source of income data for Indigenous people is the 2002 National Aboriginal and Torres Strait Islander Survey conducted by ABS. We did not look at how different the results would be based on the income data from these two surveys.
Becker and Mulligan (1997) use the terms ‘rate of time preference’ and ‘discount rate’ interchangeably.
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Acknowledgments
This study was supported through a NATSEM internal research grant. Employment and income data used in this study were derived from specially requested 2006 Census tables and the 2005–2006 Survey of Income and Housing confidential unit record files, both from the Australian Bureau of Statistics (ABS). The results based on further calculations of this data and the views expressed in this paper are those of the authors, and not necessarily those of ABS and NATSEM.
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Nepal, B., Brown, L. Modelling potential impact of improved survival of Indigenous Australians on work-life labour income gap between Indigenous and average Australians. J Pop Research 29, 157–171 (2012). https://doi.org/10.1007/s12546-012-9084-7
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DOI: https://doi.org/10.1007/s12546-012-9084-7