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ABSTRACT
Although the gender gap in incomes has been extensively researched, scant attention has been paid to the gender wealth gap. This paper compares the gender wealth gap in Australia with that of Switzerland. Using data from the 2010 Household, Income, and Labour Dynamics in Australia (HILDA) and the 2012 Swiss Household Panel (SHP), this study attributes the gender wealth gap to differences in permanent income and education. Furthermore, the gender wealth gap is much larger in Switzerland than in Australia. The study links this finding to the type of wealth held by individuals in these two countries. Differences in wealth accumulation among women in Switzerland and Australia are likely to be linked to the housing market and to family policies for (single) mothers.
ACKNOWLEDGMENTS
This contribution is based on the project “Income and Wealth Inequality, Deprivation, and Well-Being in Switzerland, 1990–2013,” supported by the Swiss National Science Foundation, grant number [100017_143320]. We conducted this study using data collected by the Swiss Household Panel (SHP), which is based at the Swiss Centre of Expertise in the Social Sciences (FORS); the Swiss National Science Foundation finances the SHP. This paper also uses unit record data from the Household, Income, and Labour Dynamics in Australia (HILDA) Survey. The Australian Government Department of Social Services (DSS) initiated and funded the HILDA Project and the Melbourne Institute of Applied Economic and Social Research (Melbourne Institute) managed it. The findings and views in this paper, however, are those of the authors and should not be attributed to either DSS or the Melbourne Institute. The gender equality grant of the University of Neuchâtel also partly funded this research. We would like to thank Ursina Kuhn, Pascale Gazareth, Jehane Simona, Katia Iglesias Rutishauser, and Christian Suter for their useful comments and advice.
SUPPLEMENTAL DATA
Supplemental data for this article can be accessed at https://doi.org/10.1080/13545701.2018.1458202.
Notes
1 In two previous years (2008 and 2009), the SHP collected some information on wealth. Questions, however, were not comparable, and the variables were categorical.
2 Wealth is top-coded in the HILDA data by substituting an average value for all the cases that are equal to or exceed a given threshold. We decided not to top-code wealth in the SHP, as there was no severe problem with outliers (Kuhn and Crettaz Citation2015). Survey data do not generally include people at the very top of the wealth distribution. Our findings are therefore not representative for the entire distribution, but they give a good picture of the average distribution of single-adult households. For this study on gender inequality, we prefer household panels over other sources, such as tax register data, because women in single households are more likely to be excluded in tax registers due to exception thresholds.
3 The larger proportion of zeros in the Swiss data could be partially due to less-detailed questions on wealth. Moreover, the SHP does not collect information about negative wealth; for comparability, we recoded negative values in the HILDA data to zero.
4 The 10th quantile is not included because of the large proportion of zeros at the bottom of the distribution.
5 We have information about superannuation accounts for non-retirees in Australia, but we do not know if employed people are saving in their second pillar in Switzerland. Given that all employees older than age 24 are forced by law to save into a second pillar (with some exceptions for very low earnings or short-term contracts), we assume that anyone who worked for at least one year as an employee should have a second pillar. For both countries, this variable means that employed people save in a pension fund and that retirees receive a payment from a pension scheme.
6 Since we have only one data point, we are unable to control for life-cycle effects and we can only compare people according to their current age.
7 This information is available in the SHP in 2013. We decided not to include this information in order to not lose part of our sample due to attrition.
8 Our sensitivity tests reported in the Supplemental Online Appendix show that the results are robust to the exclusion of single parents. The accumulation of wealth by single low-educated mothers in Switzerland appears to be particularly difficult. As expected, the observed wealth gap excluding single parents is smaller in both countries.
9 In Australia, the minimum contribution rate for employers in 2010 was 9 percent of the employee's gross salary. In Switzerland, contributions are split between employers and employees and differ according to age. Total contributions in Switzerland start from 7 percent for young people and go up to 18 percent for older ones.
10 Please see the Supplemental Online Appendix for these analyses.
11 This result contradicts the finding of Siobhan Austen et al. (Citation2015), as they excluded widows from the sample and computed total housing wealth instead of only home family wealth.
12 The variables for family allowances are not comparable between the SHP and the HILDA, and we have therefore decided to exclude them from the regressions. Data could be simulated at the municipal level to estimate the correct amount of family benefits that each single parent receives in Switzerland.
Additional information
Notes on contributors
Laura Ravazzini
Laura Ravazzini is involved in different research projects at the University of Neuchâtel and at the Swiss Centre of Expertise in the Social Sciences (FORS) based at the University of Lausanne, Switzerland, where she collaborates in the data production of international surveys. She is currently working on the estimation of wealth with Swiss survey data, on the determinants of women's labor supply, and on attitudes toward redistribution in Europe. Her research interests focus on different forms of inequality (for example, income, wealth, and opportunities) and on women's conditions.
Jenny Chesters
Jenny Chesters completed her PhD at the University of Queensland and is currently employed as a lecturer at the University of Melbourne. Her research interests focus on transitions between education and employment throughout the life course, social stratification, and wealth inequality.