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Wealth and Inheritance in the Long Run

Author

Listed:
  • Thomas Piketty

    (PSE - Paris-Jourdan Sciences Economiques - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics)

  • Gabriel Zucman

    (LSE - London School of Economics and Political Science)

Abstract

This chapter offers an overview of the empirical and theoretical research on the long-run evolution of wealth and inheritance. Wealth–income ratios, inherited wealth, and wealth inequalities were high in the eighteenth to nineteenth centuries up until World War I, then sharply dropped during the twentieth century following World War shocks, and have been rising again in the late twentieth and early twenty-first centuries. We discuss the models that can account for these facts. We show that over a wide range of models, the long-run magnitude and concentration of wealth and inheritance are an increasing function of image where image is the net-of-tax rate of return on wealth and g is the economy's growth rate. This suggests that current trends toward rising wealth–income ratios and wealth inequality might continue during the twenty-first century, both because of the slowdown of population and productivity growth, and because of rising international competition to attract capital.

Suggested Citation

  • Thomas Piketty & Gabriel Zucman, 2015. "Wealth and Inheritance in the Long Run," Post-Print halshs-01109067, HAL.
  • Handle: RePEc:hal:journl:halshs-01109067
    Note: View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-01109067
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    References listed on IDEAS

    as
    1. R. N. Vaughan, 1979. "Class Behaviour and the Distribution of Wealth," Review of Economic Studies, Oxford University Press, vol. 46(3), pages 447-465.
    2. Edward Wolff & Maury Gittleman, 2014. "Inheritances and the distribution of wealth or whatever happened to the great inheritance boom?," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 12(4), pages 439-468, December.
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    9. repec:cep:sticas:/178 is not listed on IDEAS
    10. Gabriel Zucman, 2013. "The Missing Wealth of Nations: Are Europe and the U.S. net Debtors or net Creditors?," The Quarterly Journal of Economics, Oxford University Press, vol. 128(3), pages 1321-1364.
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    More about this item

    Keywords

    inherited wealth; wealth inequalities; wealth–income ratios;

    JEL classification:

    • H00 - Public Economics - - General - - - General

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