Abstract

The Indigenous people of Australia are severely disadvantaged according to a range of objective indicators. Unfortunately, the use of subjective indicators has been largely absent from the Indigenous policy domain. This is problematic because many things that matter to Indigenous peoples cannot be measured objectively. This paper addresses this gap; specifically, we employ a range of econometric techniques and Australian household data to explore the subjective wellbeing of Indigenous Australians in relation to: (1) levels of life satisfaction; (2) inequality in life satisfaction; (3) the prevalence and severity of dissatisfaction; and (4) determinants of life satisfaction. Results indicate that Indigenous life satisfaction peaked in 2003 and has since declined, and inequality in life satisfaction is greater for Indigenous than non-Indigenous Australians. Further, while the determinants of life satisfaction for non-Indigenous Australians are consistent with existing evidence and a priori expectations, the results for Indigenous Australians differ in many respects.