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The concentration of personal wealth in Italy 1995-2016

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  • Alvaredo, Facundo
  • Acciari, Paolo
  • Morelli, Salvatore

Abstract

Italy is one the countries with the highest wealth-to-income ratio in the developed world. Yet, despite the growing policy interest, knowledge about the size distribution of wealth is currently limited. In this paper, we expand our windows of observation on the distribution of personal wealth using a novel source on the full record of inheritance tax files. The data cover up to 63% of the deceased population and are available between 1995 and 2016, a period of substantial economic turbulence and structural reform for the Italian economy. Our benchmark results rely on the distribution of the net wealth observed in the National Accounts balance sheets. Unlike available statistics estimated from household survey data, our results point to a strong rise in wealth concentration and inequality since the mid-1990s. Whereas the level of wealth concentration in Italy is in line with those of other European countries, its time trend appears more in line with the U.S. experience. Moreover, Italy stands out as one of the countries with the strongest decline in the wealth share of the bottom 50% of the adult population. We explore the role of household wealth portfolios, accumulation patterns during the life cycle, and inheritance flows, its concentration, and taxation patterns as main drivers of the trends observed. A range of alternative series of wealth concentration helps us better understand the role of adjustments and imputations and is based on a multi-series approach, i.e., comparing the pieces of information given by different and competing sources.

Suggested Citation

  • Alvaredo, Facundo & Acciari, Paolo & Morelli, Salvatore, 2021. "The concentration of personal wealth in Italy 1995-2016," CEPR Discussion Papers 16053, C.E.P.R. Discussion Papers.
  • Handle: RePEc:cpr:ceprdp:16053
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    3. Yonatan Berman & Salvatore Morelli, 2021. "On the Distribution of Estates and the Distribution of Wealth: Evidence from the Dead," NBER Chapters, in: Measuring Distribution and Mobility of Income and Wealth, pages 205-219, National Bureau of Economic Research, Inc.
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    5. Bucciol, Alessandro & Burro, Giovanni, 2022. "Is there a happiness premium for working in the public sector? Evidence from Italy," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 97(C).
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    More about this item

    Keywords

    Wealth inequality; Wealth distribution; Distributional national accounts; Estate concentration; Inheritance tax;
    All these keywords.

    JEL classification:

    • D3 - Microeconomics - - Distribution
    • H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
    • N3 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy
    • G50 - Financial Economics - - Household Finance - - - General

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