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Estimating the Impact of Covid-19 and Policy Responses on Australian Income Distribution Using Incomplete Data

This paper undertakes a near real-time analysis of the income distribution effects of the Covid-19 crisis in Australia to understand the ongoing changes in the income distribution as well as the impact of policy responses. By semi-parametrically combining incomplete observed data from three differen...

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Autores principales: Li, Jinjing, Vidyattama, Yogi, La, Hai Anh, Miranti, Riyana, Sologon, Denisa M.
Formato: Online Artículo Texto
Lenguaje:English
Publicado: Springer Netherlands 2021
Materias:
Acceso en línea:https://www.ncbi.nlm.nih.gov/pmc/articles/PMC8546393/
https://www.ncbi.nlm.nih.gov/pubmed/34720335
http://dx.doi.org/10.1007/s11205-021-02826-0
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author Li, Jinjing
Vidyattama, Yogi
La, Hai Anh
Miranti, Riyana
Sologon, Denisa M.
author_facet Li, Jinjing
Vidyattama, Yogi
La, Hai Anh
Miranti, Riyana
Sologon, Denisa M.
author_sort Li, Jinjing
collection PubMed
description This paper undertakes a near real-time analysis of the income distribution effects of the Covid-19 crisis in Australia to understand the ongoing changes in the income distribution as well as the impact of policy responses. By semi-parametrically combining incomplete observed data from three different sources–the monthly Longitudinal Labour Force Survey, the Survey of Income and Housing and administrative payroll data–we estimate the impact of Covid-19 on the Australian income distribution and decompose its impact into the income shock effect and the policy effect between February and June 2020, covering the immediate periods before and after the initial Covid-19 outbreak. Our results suggest that, despite growth in unemployment, the Gini coefficient of equivalised household disposable income dropped by more than 0.02 points between February and June 2020. This reduction is due to the additional wage subsidies and welfare supports offered as part of the policy response, offsetting the increase in income inequality from the income shock effect. The results shows the effectiveness of temporary policy measures both in maintaining living standards and avoiding increases in income inequality. However, the heavy reliance on the support measures shown in the modelling raises the possibility that the changes in the income distribution may be reversed, or even that inequality and living standards could substantially worsen once the measures are withdrawn.
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spelling pubmed-85463932021-10-26 Estimating the Impact of Covid-19 and Policy Responses on Australian Income Distribution Using Incomplete Data Li, Jinjing Vidyattama, Yogi La, Hai Anh Miranti, Riyana Sologon, Denisa M. Soc Indic Res Original Research This paper undertakes a near real-time analysis of the income distribution effects of the Covid-19 crisis in Australia to understand the ongoing changes in the income distribution as well as the impact of policy responses. By semi-parametrically combining incomplete observed data from three different sources–the monthly Longitudinal Labour Force Survey, the Survey of Income and Housing and administrative payroll data–we estimate the impact of Covid-19 on the Australian income distribution and decompose its impact into the income shock effect and the policy effect between February and June 2020, covering the immediate periods before and after the initial Covid-19 outbreak. Our results suggest that, despite growth in unemployment, the Gini coefficient of equivalised household disposable income dropped by more than 0.02 points between February and June 2020. This reduction is due to the additional wage subsidies and welfare supports offered as part of the policy response, offsetting the increase in income inequality from the income shock effect. The results shows the effectiveness of temporary policy measures both in maintaining living standards and avoiding increases in income inequality. However, the heavy reliance on the support measures shown in the modelling raises the possibility that the changes in the income distribution may be reversed, or even that inequality and living standards could substantially worsen once the measures are withdrawn. Springer Netherlands 2021-10-26 2022 /pmc/articles/PMC8546393/ /pubmed/34720335 http://dx.doi.org/10.1007/s11205-021-02826-0 Text en © The Author(s) 2021 https://creativecommons.org/licenses/by/4.0/Open AccessThis article is licensed under a Creative Commons Attribution 4.0 International License, which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons licence, and indicate if changes were made. The images or other third party material in this article are included in the article's Creative Commons licence, unless indicated otherwise in a credit line to the material. If material is not included in the article's Creative Commons licence and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder. To view a copy of this licence, visit http://creativecommons.org/licenses/by/4.0/ (https://creativecommons.org/licenses/by/4.0/) .
spellingShingle Original Research
Li, Jinjing
Vidyattama, Yogi
La, Hai Anh
Miranti, Riyana
Sologon, Denisa M.
Estimating the Impact of Covid-19 and Policy Responses on Australian Income Distribution Using Incomplete Data
title Estimating the Impact of Covid-19 and Policy Responses on Australian Income Distribution Using Incomplete Data
title_full Estimating the Impact of Covid-19 and Policy Responses on Australian Income Distribution Using Incomplete Data
title_fullStr Estimating the Impact of Covid-19 and Policy Responses on Australian Income Distribution Using Incomplete Data
title_full_unstemmed Estimating the Impact of Covid-19 and Policy Responses on Australian Income Distribution Using Incomplete Data
title_short Estimating the Impact of Covid-19 and Policy Responses on Australian Income Distribution Using Incomplete Data
title_sort estimating the impact of covid-19 and policy responses on australian income distribution using incomplete data
topic Original Research
url https://www.ncbi.nlm.nih.gov/pmc/articles/PMC8546393/
https://www.ncbi.nlm.nih.gov/pubmed/34720335
http://dx.doi.org/10.1007/s11205-021-02826-0
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