Income distribution

The Press reports:

Children raised in poor families will earn less and achieve at a lower academic standard but will not have higher crime levels, a Christchurch study has found.

The Christchurch Health and Development Study (CHDS), run by Otago University, has been following the lives of more than 1000 people since 1977.

The latest study, published in Social Science and Medicine, has looked at the impact of family on children up to the age of 10 and how this is reflected in adulthood.

“Being brought up in an affluent family is advantageous to your education and career,” he said.

This is not a huge surprise.

Fergusson said the cohort was split into 20 per cent groups, with the bottom group earning an average of $43,000 a year and the top group earning $55,000.

“It’s not a huge difference but it’s definitely there, and we have seen that it definitely makes a difference.”

I am surprised it is not greater. This is saying the bottom quintile earn 80% of the top quintile. Sure that is a gap, but not as large as many would have predicted.

One of the reasons why the gap is less than other studies of income distribution, is these are people all the same age. Age is a large factor in income. That is why I have little time for the notion that an 18 year old with no experience should earn at least 60% of the income of someone with 25 years experience.

“Contrary to popular belief, being brought up in a poor family does not mean increased rates of crime or mental health problems in adulthood,” he said.

So let us stop blaming crime on poverty. There may be a correlation but that is not causative.

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