Yesterday, Professors Lisa Adkins and Martijn Konings had a Guardian op-ed article on the inter-generational importance of inherited wealth in helping Gen Xers and Millennials to get on Australia’s property ladder. The analysis builds on Adkins, Konings and Melinda Cooper’s recent book The Asset Economy (Polity, 2020).
Economic stratification to date is often defined in the academic literature about the positional power of specific jobs. Entry into the middle class used to depend on what kind of job you were able to get – which in turn related to the ‘sorting machine’ of higher education. Adkins, Cooper and Konings find that the contemporary Australian middle class now relies more on access to long-term housing and other property. Australia has some of the most expensive housing in the world, so, therefore, inherited wealth now largely defines the stratification between the comfortable middle class and precarious renters.
There are potential complications to Adkins, Cooper and Konings’ insight which deserves further research. The Australian Federal Government’s First Home Loan Deposit Scheme and First Home Super Saver Scheme potentially open up the barriers to new first home owners and will facilitate more financialisation of mortgage-backed securities. Estate planning strategies – such as in blended families – also deserve further reflection. If we now live in an asset economy then understanding how assetisation and financialisation work – as early as possible – will become an important key to differential wealth creation.