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Wealth-Income Ratios in Free Market Capitalism: Switzerland, 1900–2020

Author

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  • Enea Baselgia

    (University of St. Gallen and is now affiliated with ETH Zurich)

  • Isabel Z. Martínez

    (ETH Zurich)

Abstract

We show that over the 20th century, the ratio of private wealth to national income, βpt, in Switzerland did not follow a U-shaped pattern, thereby contrasting the evolution in most European countries. Instead, the ratio was exceptionally stable at around 500%. We argue that this consistently high βpt was the result of geopolitical factors combined with Switzerland's capital-friendly policymaking. Since the turn of the century, however, βpt has been on a rapid rise to reach 793% in 2020. This exceptionally fast increase is mainly driven by large capital gains, especially in housing wealth.

Suggested Citation

  • Enea Baselgia & Isabel Z. Martínez, 2025. "Wealth-Income Ratios in Free Market Capitalism: Switzerland, 1900–2020," The Review of Economics and Statistics, MIT Press, vol. 107(4), pages 914-934, July.
    • Handle: RePEc:tpr:restat:v:107:y:2025:i:4:p:914-934
    DOI: 10.1162/rest_a_01313
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