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Understanding changes in Māori incomes and income inequality 1997–2003.

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Journal of Population Economics, 20(3), 571-598

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Dixon and Maré's present a comprehensive analysis of the changes in income distribution and labour market activity among working-aged Māori from 1997 to 2003.

The paper begins by mapping key changes in the educational attainment and occupational profiles of the Māori population, noting a significant shift towards skilled managerial, professional, and technical jobs, and an impressive 9% increase in employment rates among working-aged Māori. These trends suggest new patterns of job-related skill acquisition and point to an evolving labour market landscape for the Māori population. The study provides detailed insights into the weekly pre-tax income statistics for Māori, highlighting a decline in the proportion of working-aged Māori with no income or relying on government benefits, and an average real income gain of 16%. Kernel density estimates further reveal a decrease in income density at low-income levels and substantial increases at income levels above NZ$500 a week. These findings indicate a broadening of income distribution across various income levels, reflecting a shift away from concentration at low or lower-middle incomes. A key finding of the study is the reduction in income inequality among the total population of working-aged Māori, driven by a decrease in the proportion of individuals with zero or benefit-level incomes and an increased clustering at the central peak of the distribution. However, the income inequality among employed Māori showed little change during this period.
The paper also compares the changes in the Māori income distribution with those of the European population in New Zealand, noting similar patterns and suggesting common drivers of change. While there was a slight reduction in the income gap between all working-aged Māori and Europeans, the gap between employed individuals of both groups remained stable or slightly increased. Dixon and Maré’s analysis concludes that the transition of many Māori from unemployment to employment had a substantial impact on the overall income distribution, likely accounting for the majority of the observed changes. Additionally, shifts in other income-related attributes, especially education, and changes in the occupational structure of Māori employment, are believed to have significantly contributed to these developments. This study is pivotal for understanding the dynamics of income distribution and labour market changes within New Zealand’s indigenous population and provides valuable insights for policy formulation aimed at economic and social equity.

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