BACKGROUND

There has been debate in Australia about whether income inequality is increasing. Using annual income data, a range of studies suggested that income inequality increased in the 1980s.1,2 Using weekly income data, Harding found that income inequality had remained stable between 1982 and 1993–94,3 and between 1982 and 1996–97.4 However, it has since emerged that there may be major problems with the weekly income data collected in the 1982 Income Survey, so that there are now doubts about the reliability of results based on this data. In addition, recent research conducted by the National Centre for Social and Economic Modelling (NATSEM) has also suggested that income inequality in the 1996–97 Income Survey looks much too equal, relative to earlier and later surveys.5 These issues, of possible data problems and data comparability, are currently being examined in a joint project by the Australian Bureau of Statistics (ABS) and the Social Policy Research Centre. This current article is thus restricted to an analysis of data collected at the end of the 1980s and in the 1990s. INCOME TRENDS This article uses weekly income data from two sets of national sample surveys undertaken by the Australian Bureau of Statistics to look at income inequality trends in the 1990s. The methodology of the study is described in detail in Harding and Greenwell.5 In summary, the data sources are the unit record tapes released by the ABS for the Household Expenditure Surveys and the Incom