Lead Story
Issue No. 52 - April/May 2010
Growth=Wealth?
by Professor Richard Blandy
The Australian State with the slowest growing economy (Gross State Product) over the past 20 years has been South Australia. The State with the fastest growing economy over the past 20 years has been Queensland.
But South Australians’ standard of living, measured by average household disposable income per head was $34,053 per annum in 2009 – $1155 per annum greater than Queenslanders’ average household disposable income per head, and only $2459 per annum less than the Australian average.
How can this be so?
I have lived in a lot of great places, and I know (like other Adelaideians) that Adelaide is just a fabulous place to live. But, like everyone else, I have worried about this situation being sustainable in the face of SA’s slow – by Australian standards – rate of economic growth.
This article explains why those worries turn out to be broadly misplaced. It is a story about how our truly remarkable country ‘evens out’ differences in living standards among the states and territories, whatever the differences in economic growth rates among them may be.
One of the extraordinary features of Australia’s economy is the very small range in standards of living that exists among the states and territories – with the notable exception of Canberra!
As Table 1 shows, the lowest standard of living in 2009, as measured by average household disposable income per head, is in Queensland ($32,898) which is 10% below the Australian average of $36,602. The highest, apart from in the ACT, is in WA ($39,011), which is only 7% above the Australian average. Hence, the range in average standards of living by State or Territory (Canberra aside) from lowest to highest is only $6113, or 17% of the Australian average.
Average household disposable income per head in Canberra, however, is $54,890 - 50% above the Australian average!
Further, the spread of household incomes among the states and territories (Canberra apart) is n...
