Review of Income and Wealth

Publisher:
Wiley
Publication date:
2021-02-01
ISBN:
0034-6586

Latest documents

  • A Novel Sampling Strategy for Surveying High Net‐Worth Individuals—A Pretest Application Using the Socio‐Economic Panel

    High‐wealth individuals are typically underrepresented or completely missing in population surveys. The lack of comprehensive national registers on high‐wealth individuals in many countries challenged previous attempts to remedy this under‐representation. In a novel research design, we draw on public data on the shareholding structures of companies as a sampling frame. Our design builds on the empirical regularity that high‐wealth individuals are likely to hold at least part of their assets in the form of shareholdings. Based on data from over 270 million companies worldwide, we select all individuals who are both German residents and registered shareholders of companies. In a pretest, we interviewed 124 households from a gross sample of 2,000 anchor persons. Our analysis shows that values of shareholdings from register data highly correlate with individual ranks in the wealth distribution, that the quality of personal information, particularly the residential address, is sufficiently high for subsequent interviewing, and that the approach can fill a major data and research gap in the study of high‐wealth individuals.

  • Alternative Land‐Price Indexes for Commercial Properties in Tokyo

    The System of National Accounts (SNA) requires separate estimates for the land and structure components of a commercial property. Using transactions data for the sales of office buildings in Tokyo, a hedonic regression model (the “builder’s model”) was estimated and this model generated an overall property price index as well as subindexes for the land and structure components of the office buildings. The builder’s model was also estimated using appraisal data on office building real estate investment trusts (REITs) for Tokyo. These hedonic regression models also generated estimates for net depreciation rates, which can be compared. Finally, the Japanese government constructs annual official land prices for commercial properties based on appraised values. The paper compares these official land prices with the land prices generated by the hedonic regression models based on transactions data and on REIT data. The results reveal that commercial property indexes based on appraisal and assessment prices lag behind the indexes based on transaction prices.

  • Assortative Mating and Earnings Inequality in France

    This paper analyzes assortative mating and its contribution to inequality in France. We first provide descriptive evidence on the statistical association in several socio‐economic attributes of partners. Second, we assess the contribution of assortative mating to earnings inequality between couples. We provide a new method for assessing the contribution of assortative mating to inequality in couple’s potential earnings, that accounts for selection bias arising from labor force participation. Our results indicate a strong degree of assortative mating in France. The correlation in earnings is around 0.17 for annual earnings, around 0.35 for full‐time equivalent earnings and up to 0.49 when using multi‐year average earnings. Assortative mating tends to increase inequality among couples. For annual earnings, the effect accounts for 3 to 9 percent of measured inequality. The effect of assortative mating on household potential earnings is much larger and amounts to 10 to 20 percent for observed inequality.

  • Call for Papers for the IARIW‐TNBS Conference on “Measurement of Income, Wealth and Well‐being in Africa” October 7‐9, 2021, Arusha, Tanzania
  • Deprivation of Women and Men Living in a Couple: Sharing or Unequal Division?

    In standard poverty analyses, all household members are assumed to share equal living conditions. Though a few national studies exist, this paper is the first to present empirical evidence on this issue for the EU, using the 2015 wave of the EU Statistics on Income and Living Conditions. We map the extent of intra‐couple inequality in deprivation, and analyze its determinants. We find that for most items, the gender difference in lack between partners, though generally small, is significant and at the disadvantage of women. When aggregating the individual items into a deprivation scale, couples where the number of enforced lacks is higher for the woman (9.2 percent) are (significantly) more numerous than couples where the man is disadvantaged (6.5 percent), at the EU level. Econometric analysis shows that the work status of the partners and their relative contribution to the joint income are important determinants of the intra‐couple gender deprivation gap.

  • Income Underreporting and Tax Evasion in Italy: Estimates and Distributional Effects

    The paper estimates the extent of evasion of personal income tax (PIT) in Italy by integrating two methods that the literature has previously applied separately. The consumption‐based method introduced by Pissarides and Weber (1989) is used to estimate misreporting of income in micro data collected in the household IT‐SILC survey. We adopt an econometric specification close in spirit to that of Feldman and Slemrod (2007), which allows us to estimate income misreporting at different rates for different income sources. The misreporting estimates are then used in the discrepancy method to correct the incomes compared with administrative registered data. The comparison provides new estimates of evasion of personal income tax by type of income, region and income class. The estimates are used to improve microsimulation analyses of the distributional impact of tax evasion.

  • Inequality in Pre‐Income Survey Times: A Methodological Proposal

    We propose different alternatives of inequality estimation for economies with a big agricultural sector where land is a decisive factor in income generation and where we do not have enough information about personal earnings. To this end, we use the Uruguayan case to test our methodology. We propose six analytical exercises where Gini indexes are calculated, and as reference we choose the estimation that better adjusts to some theoretical and empirical conditions. Finally, we check the historical accuracy of the series by looking at income distribution explicative variables and the shape of the Inequality possibility frontier. Our results are consistent with the economic and social events of the period (1870–1912) and with previous estimates which reveal worsening trends in income distribution. However, our annual data allow capturing the dynamics of the process where breaks in the series are observed and improvements and declines alternate in the evolution of income distribution.

  • Issue Information
  • Productivity and Growth in Perspective: Chile, 1833–2010

    This paper presents a long‐period growth accounting for Chile, an emerging economy, from the early nineteenth century through to 2010. The methodology, data, and sources used are thoroughly discussed, and the results are compared with a benchmark based on a sample of countries. Some of the findings are: Chile's average productivity growth over the whole period is explained mainly by capital deepening, but long period averages hide huge and variable differences when various time subdivisions are explored. Gross TFP growth increases throughout phases until 1973 when an international reduction sets in. The research also put the role of employment‐population ratio into perspective.

  • Productivity Dispersion and Measurement Error

    Several reasons have been put forward to explain the high dispersion of productivity across establishments: quality of management, different input usage and market distortions, to name but a few. Although it is acknowledged that a sizable portion of productivity dispersion may also be due to measurement error, little research has been devoted to identifying how much they contribute. We outline a novel procedure for identifying the role of measurement error in explaining the empirical dispersion of productivity across establishments. The starting point of our framework is the errors‐in‐variable model consisting of a measurement equation and a structural equation for latent productivity. We estimate the variance of the measurement error and subsequently estimate the variance of the latent productivity variable, which is not contaminated by measurement error. Using Norwegian data on the manufacture of food products, we find that about one percent of the measured dispersion stems from measurement error.

Featured documents

  • Assortative Mating and Earnings Inequality in France

    This paper analyzes assortative mating and its contribution to inequality in France. We first provide descriptive evidence on the statistical association in several socio‐economic attributes of partners. Second, we assess the contribution of assortative mating to earnings inequality between couples....

  • Productivity and Growth in Perspective: Chile, 1833–2010

    This paper presents a long‐period growth accounting for Chile, an emerging economy, from the early nineteenth century through to 2010. The methodology, data, and sources used are thoroughly discussed, and the results are compared with a benchmark based on a sample of countries. Some of the findings ...

  • The Effect of the Arab Spring on Preferences for Redistribution in Egypt

    This paper investigates the effect of the revolution that occurred in January 2011 in Egypt on the demand for redistribution in that country, which has drastically increased since that period. This shock has been an important event, enhancing freedom and the political structure. In a first step,...

  • A Novel Sampling Strategy for Surveying High Net‐Worth Individuals—A Pretest Application Using the Socio‐Economic Panel

    High‐wealth individuals are typically underrepresented or completely missing in population surveys. The lack of comprehensive national registers on high‐wealth individuals in many countries challenged previous attempts to remedy this under‐representation. In a novel research design, we draw on...

  • Deprivation of Women and Men Living in a Couple: Sharing or Unequal Division?

    In standard poverty analyses, all household members are assumed to share equal living conditions. Though a few national studies exist, this paper is the first to present empirical evidence on this issue for the EU, using the 2015 wave of the EU Statistics on Income and Living Conditions. We map the ...

  • Income Underreporting and Tax Evasion in Italy: Estimates and Distributional Effects

    The paper estimates the extent of evasion of personal income tax (PIT) in Italy by integrating two methods that the literature has previously applied separately. The consumption‐based method introduced by Pissarides and Weber (1989) is used to estimate misreporting of income in micro data collected ...

  • Inequality in Pre‐Income Survey Times: A Methodological Proposal

    We propose different alternatives of inequality estimation for economies with a big agricultural sector where land is a decisive factor in income generation and where we do not have enough information about personal earnings. To this end, we use the Uruguayan case to test our methodology. We...

  • Top Incomes in Chile: A Historical Perspective on Income Inequality, 1964–2017

    We present a novel series of Chilean top‐income shares covering half a century, mainly based on income‐tax declarations and the National Accounts. Such a time frame of analysis is still rare in the literature of developing countries. We distinguish between a fiscal‐income series (1964–2017) and an...

  • Productivity Dispersion and Measurement Error

    Several reasons have been put forward to explain the high dispersion of productivity across establishments: quality of management, different input usage and market distortions, to name but a few. Although it is acknowledged that a sizable portion of productivity dispersion may also be due to...

  • Issue Information

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