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Income, Wealth and Intergenerational Inequality in the Netherlands

Author

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  • Emiel Afman

Abstract

This economic brief brings together publicly available income and wealth data and finds that the distribution of income among Dutch households is relatively stable and flat by international standards. Inequalities in net wealth holdings are relatively large. This is to a large extent a debt-driven phenomenon and related to the large number of Dutch households with low and sometimes negative net housing equity. Addressing household debt, e.g. by lowering the debt bias for households in the tax system, would strengthen household balance sheets and lower wealth-risks for households. In intergenerational terms, the position of the baby boom generation stands out. Both in terms of income and wealth, they are much richer than all other generations. However, their wealth position doesn’t deviate much from what one could expect based on theoretical or synthetic counterfactuals, based on actual income and saving patterns. Millennials (born after 1980) seem to have started their working lives at lower real incomes than previous generations.

Suggested Citation

  • Emiel Afman, 2020. "Income, Wealth and Intergenerational Inequality in the Netherlands," European Economy - Economic Briefs 053, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
    • Handle: RePEc:euf:ecobri:053
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    File URL: https://economy-finance.ec.europa.eu/publications/income-wealth-and-intergenerational-inequality-netherlands_en
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    References listed on IDEAS

    as
    1. Wiemer Salverda, 2015. "EU Policy Making and Growing Inequalities," European Economy - Discussion Papers 008, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
    2. Carlotta Balestra & Richard Tonkin, 2018. "Inequalities in household wealth across OECD countries: Evidence from the OECD Wealth Distribution Database," OECD Statistics Working Papers 2018/01, OECD Publishing.
    3. Atkinson, A B, 1971. "The Distribution of Wealth and the Individual Life-cycle," Oxford Economic Papers, Oxford University Press, vol. 23(2), pages 239-254, July.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Gabriele Guaitoli & Roberto Pancrazi, 2022. "Global Trends in Intergenerational Income Inequality?," LIS Working papers 828, LIS Cross-National Data Center in Luxembourg.
    2. Sarandrea, Marco, 2021. "An Investigation on Intercohort Income Inequalities and Millennials Impoverishment in Great Britains Regions," Warwick-Monash Economics Student Papers 30, Warwick Monash Economics Student Papers.

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    More about this item

    Keywords

    Netherlands; income inequality; wealth inequality; intergenerational inequality; debt bias; household debt; households; economic brief; Afman.;
    All these keywords.

    JEL classification:

    • I30 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General
    • J10 - Labor and Demographic Economics - - Demographic Economics - - - General
    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts
    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • D04 - Microeconomics - - General - - - Microeconomic Policy: Formulation; Implementation; Evaluation
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies

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