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Wealth and Income Inequality Early in Life: Underage Children as Owners of Privately Held Firms

Author

Listed:
  • Tuuli Paukkeri
  • Terhi Helena Ravaska

Abstract

Using unique administrative data that link privately held firm owners to rich background information, we provide novel evidence on underage children as firm owners. Ownership occurs at all ages 0--17, with a mean age of 12. Childhood ownership is strongly concentrated among high-income families, creates substantial early-life income flows and exacerbates intergenerational inequality. Firm-owning children have in their childhood average incomes which would place them in the fourth decile of the adult income distribution and which imply wealth holdings at the seventh wealth decile. At age 30, child owners are substantially overrepresented in their cohort’s top 1%.

Suggested Citation

  • Tuuli Paukkeri & Terhi Helena Ravaska, 2026. "Wealth and Income Inequality Early in Life: Underage Children as Owners of Privately Held Firms," CESifo Working Paper Series 12491, CESifo.
    • Handle: RePEc:ces:ceswps:_12491
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    Keywords

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    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • H32 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Firm

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