Old people have relatively low incomes. This suggests that the ageing population might imply growing income inequality. However, previous research (Harding, 1995) has suggested. that Australia’s ageing population made no contribution to the increase in income inequality from 1982 to 1993.’ This result challenges intuition (Harding calls it “somewhat surprising”, 1995, p. 60) and warrants further examination which is the primary purpose of this paper.