The average top income in New Zealand is that of a professional, executive or entrepreneur.
Source: The World Wealth and Income Database.
Average top incomes in New Zealand
05 Jul 2016 Leave a comment
in human capital, labour economics, labour supply, occupational choice, poverty and inequality Tags: creative destruction, entrepreneurial alertness, top 1%
Wage gaps by gender, race and ethnicity persist in the USA
03 Jul 2016 Leave a comment
in discrimination, economics of education, gender, human capital, labour economics, labour supply, occupational choice, politics - USA Tags: employer discrimination, ethnic wage gap, gender wage gap, racial discrimination, racial wage gap
.@nzteu is right, student loans entrench inequality
29 Jun 2016 Leave a comment
in economics of education, economics of love and marriage, human capital, labour economics, occupational choice, poverty and inequality Tags: power couples, student loans
Those of European ethnicity had a median net worth of $114,000, compared with $23,000 for Māori , $12,000 for Pasifika and $33,000 for Asians according to the latest Statistics New Zealand data just released.
The Tertiary Education Union made great play about how much of the low net worth of young people and others is due to student loans
Young people (aged 15–24) had the lowest individual median net worth of any age group – just $1,000. The most common debt for young people is education loans.
The union then goes on to say that
Median education loan liabilities are only one-tenth of Pākehā people’s median assets, but they are a quarter of Māori people’s assets and over a third of Pacific people’s assets (table 7.01).
The data shows that the households with the smallest median net worth have the largest median education loans (table 2.02). These loans make up nearly a quarter of their total debt (table 2.03).
Over a third of households within the poorest quintile of net worth have education loans, whereas less than a tenth of households in the wealthiest quintile have education debt (table 2.04).
In a nutshell, not enough people are going to university because of the prospect of repaying student loans and more would go if it were cheaper and that would reducing inequality. The explosion in tertiary educational attendance over the last generation, an increase of about 150% for the adult population aged 25 to 64 was not good enough to reduce inequality.
Free tuition at University is a hand-out to those already had a good start in life. It will be paid for by those who will never go because they do not have an above average IQ.
How much more will you earn by going to university? It depends hugely on which country you're from http://t.co/7RMnUTM8nj—
paulkirby (@paul1kirby) September 11, 2015
Low-cost student loans were supposed to be away to reduce inequality. Instead, they give a flying start to those of already above-average talents. If social justice is to mean anything, it does not involve giving freebies to those who already have a head start in life.
The average student loan debt is about $14,000 while the lifetime earnings premium from university education is about $1/2 million in New Zealand.
Source: Statistics New Zealand, Household net worth statistics: Year ended 30 June 2015.
Lowering university tuition fees and easing the terms of student loans simply means that those who do well at university will not have to pay back as much to the government. People who succeed at university already have above average IQs so they already had a good head start in life.
Charles Murray points out that succeeded at college requires an IQ of at least 115 but 84% of the population don’t have this:
Historically, an IQ of 115 or higher was deemed to make someone “prime college material.” That range comprises about 16 per cent of the population. Since 28 per cent of all adults have BAs, the IQ required to get a degree these days is obviously a lot lower than 115.
Cheaper higher education does not help the not so smart secure a qualification they lack the innate talent to earn with decent marks and increases the chance of smart men and women marrying. This increases the inequality between power couples and the rest.
Robots Are Really Bad At Folding Towels
25 Jun 2016 Leave a comment
in economics, economics of media and culture, entrepreneurship, human capital, labour economics, labour supply Tags: creative destruction, robots
Source: Robots Are Really Bad At Folding Towels : Planet Money : NPR.
Gender preferences for higher earnings vs. other job attributes
25 Jun 2016 Leave a comment
in discrimination, gender, human capital, labour economics, labour supply, occupational choice
Differences in raw gender wage gaps may be almost entirely the result of the individual choices made by both male and female workers.
James Heckman on the Economics of Human Development
14 Jun 2016 Leave a comment
in applied price theory, applied welfare economics, discrimination, economics, economics of education, human capital, labour economics, labour supply, poverty and inequality Tags: James Heckman
Gender differences in jobs and occupations since 1960
07 Jun 2016 Leave a comment
in economic history, economics, gender, human capital, labour economics, labour supply, occupational choice Tags: gender wage gap
The widening gender gap in the teenage Dunning-Kruger effect
05 Jun 2016 Leave a comment
in economics of education, gender, human capital
Hayek on what determines market incomes
05 Jun 2016 Leave a comment
in applied price theory, entrepreneurship, F.A. Hayek, human capital, industrial organisation, labour economics, labour supply, occupational choice, poverty and inequality, survivor principle Tags: distributive justice, social justice
Few of the top 50 billionaires inherited their wealth
01 Jun 2016 Leave a comment
in applied price theory, applied welfare economics, economic history, entrepreneurship, financial economics, human capital, labour economics, poverty and inequality, unions Tags: entrepreneurial alertness, inherited wealth, superstar wages, superstars, top 0.1%, top 1%
Of the 15 inheritance based billionaires, three are from the Walton family, two are the Koch brothers and another three are from the Mars family.
Source: The world’s top 50 billionaires: A demographic breakdown.
The decline and decline of the rentier class in the USA
24 May 2016 Leave a comment
in economic history, entrepreneurship, human capital, industrial organisation, labour economics, labour supply, occupational choice, politics - USA, poverty and inequality Tags: entrepreneurial alertness, superstar wages, superstars, top 1%, top incomes
Looks like the Reagan Revolution coincided with the American rich going out to work for a living. They started earning most of their incomes from wages, salaries and pensions or from entrepreneurial income. The American rich are now working rich; top wage earners, not top income earners.
Source: The World Wealth and Income Database.
More on the top 1% giving women a pass on the great wage stagnation
23 May 2016 Leave a comment
in discrimination, economic history, economics of media and culture, gender, human capital, labour economics, labour supply, occupational choice, poverty and inequality Tags: gender wage gap, middle class stagnation, reversing gender gap, wage stagnation
Source: Read Online — Visualizing Economics.
% of top incomes from wages, salaries and pensions
23 May 2016 Leave a comment
in applied price theory, applied welfare economics, economic history, entrepreneurship, human capital, industrial organisation, labour economics, labour supply, occupational choice, poverty and inequality, survivor principle Tags: entrepreneurial alertness, envy, superstar wages, superstars, top 1%, top incomes
Everybody from the top 10% to the top 0.01% have to work for their living these days with much of their income coming from wages.
Source: The World Wealth and Income Database.
Utopia, you are standing in it! 
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