Australia is at risk of “giving up on equity” if governments fail to reform housing and tax policies to improve the economic prospects of younger generations, one of the country’s most respected economists has warned.

It comes as experts grow increasingly concerned that the cost of living challenges could worsen generational inequality, as young Australians become more frustrated over the current economic circumstances.

Ross Garnaut, an emeritus professor of economics at the University of Melbourne who has spent his career working in public policy, said young people are rightly justified in feeling as if the economy is stacked against them.

“Especially when you compare the situation with younger Australians when I was their age,” he told The Business.

“[It’s] much harder to get housing compared with the days of full employment which I grew up in, [it’s] harder to get a job, and especially if people don’t have high qualifications.

Asked whether the housing crisis was influencing how young people approach university and their careers, Professor Garnaut said in his view, it was affecting “their attitude to life”.