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The concentration of personal wealth in Italy 1995-2016

Author

Listed:
  • Paolo Acciari

    (Italian Ministry of Economy and Finance D)

  • Facundo Alvaredo

    (PSE - Paris School of Economics - ENPC - École des Ponts ParisTech - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique - EHESS - École des hautes études en sciences sociales - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, INET Oxford - Institute for New Economic Thinking at the Oxford Martin School, EP-UBA-Conicet)

  • Salvatore Morelli

    (University of Roma Tre, Stone Center on Socio-Economic Inequality)

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

  • Paolo Acciari & Facundo Alvaredo & Salvatore Morelli, 2021. "The concentration of personal wealth in Italy 1995-2016," World Inequality Lab Working Papers halshs-03226113, HAL.
  • Handle: RePEc:hal:wilwps:halshs-03226113
    Note: View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-03226113
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    Cited by:

    1. 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, National Bureau of Economic Research, Inc.
    2. Marcon, Giulio, 2021. "La ricchezza in Italia Rapporto di ricerca [Wealth in Italy. Research Report]," MPRA Paper 107809, University Library of Munich, Germany.

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    More about this item

    Keywords

    Inheritance and gifts; Estate concentration; Distributional national accounts; Top wealth shares; Wealth distribution; Wealth inequality; 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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