Wealth mobility and dynamics over entire individual working life cycles
We study taxable wealth in unique Swedish administrative data, annually following a large sample of households over a period of almost 40 years. The main data limitation is non-observability of wealth for those below the tax exemption level. This implies that much of the focus of the paper is on the rich, since we are confined to those whose wealth becomes taxable over time. We exploit the long panel dimension by estimating dynamic ?fixed effects? models for limited dependent variables that allow for individual heterogeneity in both constants and autoregressive parameters, and control for heterogeneity through observables. We find substantial wealth mobility over the long time spans, partly accounted for by life-cycle behavior, while sufficiently capturing dynamics by an AR(1) process at the individual level.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Marco Cagetti & Mariacristina De Nardi, 2006.
"Taxation, entrepreneurship, and wealth,"
Working Paper Series
WP-06-07, Federal Reserve Bank of Chicago.
- Tullio Jappelli & Luigi Pistaferri, 1999.
"The Dynamics of Household Wealth Accumulation in Italy,"
CSEF Working Papers
27, Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy, revised 01 Dec 2000.
- Tullio Jappelli & Luigi Pistaferri, 2000. "The dynamics of household wealth accumulation in Italy," Fiscal Studies, Institute for Fiscal Studies, vol. 21(2), pages 269-295, June.
- Martin Browning & Jesus Carro, 2006. "Heterogeneity and Microeconometrics Modelling," CAM Working Papers 2006-03, University of Copenhagen. Department of Economics. Centre for Applied Microeconometrics.
- Karen E. Dynan & Jonathan Skinner & Stephen P. Zeldes, 2000.
"Do the Rich Save More?,"
NBER Working Papers
7906, National Bureau of Economic Research, Inc.
- Shorrocks, A F, 1978. "The Measurement of Mobility," Econometrica, Econometric Society, vol. 46(5), pages 1013-24, September.
- Martin Browning & Jesus Carro, 2006.
"Heterogeneity in dynamic discrete choice models,"
Economics Series Working Papers
287, University of Oxford, Department of Economics.
- Klevmarken, N. Anders, 2001.
"On the Wealth Dynamics of Swedish Families 1984-1998,"
Working Paper Series
2001:17, Uppsala University, Department of Economics.
- Klevmarken, N.A., 2001. "On the Wealth Dynamics of Swedish Families 1984-1998," Papers 2001:17, Uppsala - Working Paper Series.
- Edin, P.-A. & Fredriksson, P., 2000.
"LINDA - Longitudinal INdividual DAta for Sweden,"
2000:19, Uppsala - Working Paper Series.
- Edin, Per-Anders & Fredriksson, Peter, 2000. "LINDA - Longitudinal INdividual DAta for Sweden," Working Paper Series 2000:19, Uppsala University, Department of Economics.
- Edin, P.-A. & Fredriksson, P., 2000. "LINDA - Longitudinal INdividual DAta for Sweden," Papers 2000-19, Uppsala - Working Paper Series.
- Fernández-Val, Iván, 2009.
"Fixed effects estimation of structural parameters and marginal effects in panel probit models,"
Journal of Econometrics,
Elsevier, vol. 150(1), pages 71-85, May.
- Ivan Fernandez-Val, 2007. "Fixed Effects Estimation of Structural Parameters and Marginal Effects in Panel Probit Models," Boston University - Department of Economics - Working Papers Series WP2007-009, Boston University - Department of Economics.
- Gourieroux Christian & Monfort Alain & Trognon A, 1982. "Estimation and test in probit models with serial correlation," CEPREMAP Working Papers (Couverture Orange) 8220, CEPREMAP.
- Jinyong Hahn & Whitney Newey, 2003.
"Jackknife and analytical bias reduction for nonlinear panel models,"
CeMMAP working papers
CWP17/03, Centre for Microdata Methods and Practice, Institute for Fiscal Studies.
- Jinyong Hahn & Whitney Newey, 2004. "Jackknife and Analytical Bias Reduction for Nonlinear Panel Models," Econometrica, Econometric Society, vol. 72(4), pages 1295-1319, 07.
- Huggett, Mark, 1996. "Wealth distribution in life-cycle economies," Journal of Monetary Economics, Elsevier, vol. 38(3), pages 469-494, December.
- Klevmarken, A. & Lupton, J. & Stafford, F., 2000.
"Wealth Dynamics in the 1980' and 1990's: Sweden and the U.S,"
2000-18, Uppsala - Working Paper Series.
- Klevmarken, Anders & Lupton, Joseph & Stafford, Frank, 2000. "Wealth Dynamics in the 1980’s and 1990’s: Sweden and the U.S," Working Paper Series 2000:18, Uppsala University, Department of Economics.
- Klevmarken, A. & Lupton, J. & Stafford, F., 2000. "Wealth Dynamics in the 1980' and 1990's: Sweden and the U.S," Papers 2000:18, Uppsala - Working Paper Series.
- Luojia Hu, 2002. "Estimation of a Censored Dynamic Panel Data Model," Econometrica, Econometric Society, vol. 70(6), pages 2499-2517, November.
- Selin, Håkan, 2009.
"The Rise in Female Employment and the Role of Tax Incentives. An Empirical Analysis of the Swedish Individual Tax Reform of 1971,"
Working Paper Series
2009:4, Uppsala University, Department of Economics.
- Håkan Selin, 2009. "The Rise in Female Employment and the Role of Tax Incentives - An Empirical Analysis of the Swedish Individual Tax Reform of 1971," CESifo Working Paper Series 2629, CESifo Group Munich.
- Selin, Håkan, 2009. "The Rise in Female Employment and the Role of Tax Incentive. An Empirical Analysis of the Swedish Individual Tax Reform of 1971," Working Paper Series, Center for Fiscal Studies 2009:3, Uppsala University, Department of Economics.
- Ana Castaneda & Javier Diaz-Gimenez & Jose-Victor Rios-Rull, 2003. "Accounting for the U.S. Earnings and Wealth Inequality," Journal of Political Economy, University of Chicago Press, vol. 111(4), pages 818-857, August.
- Davies, James B. & Shorrocks, Anthony F., 2000. "The distribution of wealth," Handbook of Income Distribution, in: A.B. Atkinson & F. Bourguignon (ed.), Handbook of Income Distribution, edition 1, volume 1, chapter 11, pages 605-675 Elsevier.
- Anders Klevmarken, & Joseph P. Lupton & Frank P. Stafford, 2003. "Wealth Dynamics in the 1980s and 1990s: Sweden and the United States," Journal of Human Resources, University of Wisconsin Press, vol. 38(2).
- Nancy A. Jianakoplos & Paul L. Menchik, 1997. "Wealth Mobility," The Review of Economics and Statistics, MIT Press, vol. 79(1), pages 18-31, February.
- Hahn, Jinyong & Kuersteiner, Guido, 2011. "Bias Reduction For Dynamic Nonlinear Panel Models With Fixed Effects," Econometric Theory, Cambridge University Press, vol. 27(06), pages 1152-1191, December.
- Richard H. Steckel & Jayanthi Krishnan, 2006. "THE WEALTH MOBILITY OF MEN AND WOMEN DURING THE 1960s AND 1970s," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 52(2), pages 189-212, 06.
When requesting a correction, please mention this item's handle: RePEc:bcl:bclwop:bclwp056. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.