Income Distribution, Redistribution and Incentives

The available empirical evidence indicates that the distribution of private income in Australia is polarising. While there are a number of factors underlying this trend, it is clear that the dramatic swing to "economic rationalist" policies since the mid 1980s has been a major cause of the problem. An important part of the economid rationalist moveemnt is a commitment to smaller government and lower taxes. Specific elements of the latter include lower taxes on personal income with particular emphasis on reducing the top marginal rate.