The Relationship between Individual Labour Market Outcomes, Household Income and Expenditure, and Inequality and Poverty in New Zealand from 1983 to 2003

This paper investigates the relationship between individual labour market outcomes, household income and expenditure, and inequality and poverty in New Zealand using detailed data from the 1983/84 – 2003/04 Household Economic Survey (HES). We begin by discussing and summarising measures of income and expenditure calculated from the HES. We next examine the relationship between individual labour market outcomes, and household income and expenditure for households with different characteristics. In particular, we focus on how this relationship varies over the life cycle and over time. This analysis is then extended to examine inequality in labour market outcomes, household income and household expenditure. In the last section, we examine the determinants of the levels and changes in poverty in New Zealand using both expenditure and income data. We also apply a newly developed methodology for combining income and expenditure data to produce poverty indicators.