Are Australians the richest people on earth?

The Credit Swisse Global Wealth Report 2013 was released on 9 October 2013 and indicates some perhaps not-so-surprising news for Australians:

In US dollar terms, household wealth in Australia grew rapidly between 2000 and 2013, apart from a brief interlude in 2008. The average annual growth rate has been 13%, but about half of the rise is due to exchange rate appreciation. Using constant exchange rates, wealth has grown on average by just 3.3% per annum since 2007. Despite this recent slowdown, Australia’s wealth per adult in 2013 is USD 402,600, the second highest in the world after Switzerland.  Even more strikingly, its median wealth of USD 219,500 is the highest in the world.

You read that one correctly:  in terms of median wealth, we Australians top the world, beating number two Switzerland.

Remember that when it comes to wealth, the median – the halfway point in a distribution – is probably a much more accurate measure than “average”, which takes all figures and divides them.  In other words, one Gina Rinehart – the richest woman in the world, worth estimated between US$17 billion and Aus$22 billion – can make up for a whole lot of poor people when it comes to an average.  But with a “median”, if she is at the top, she is equivalent to the poorest Australian – in other words, one cancels the other out, and median is between them, but the “average” would be approximately one-half of Rinehart’s wealth.

Are these Australian wealth figures wrong?  Probably not.

Yesterday’s (October 12) Australian reports figures from Colliers International that commercial rentals on “Sydney’s Pitt Street Mall have leapfrogged Milan’s Via Monte Napoleone to become the eighth most expensive in the world.”

The only shopping districts ahead of Sydney are New York City’s Fifth Avenue (at number one) and Madison Avenue; Hong Kong’s Queens Road Central, Canton Road and Causeway Bay; and Zurich’s Via Monte Napoleone.

Meanwhile, research due to be released shortly by the Australian National University’s Centre for Aboriginal Economic Policy Research and conducted by Dr Nicholas Biddle concludes that “more than a third of Indigenous Australians (36.6%) live among the most disadvantaged 10 percent” of Australians, and “only 1.7 percent live among the top 10 percent”.  The Australian has graphed this disadvantage, and I reproduce their graph below:

Indigenous disadvantage graph Biddle - The Aust(Graph reproduced from The Australian.)

The smallest gap?  In Sydney’s “lower north”.  More on this in a later post.  But clearly not every Australian is sitting up with the Swiss in median income, or buying their goods on Pitt Street Mall, one of the most expensive in the world.

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