A Safe Harbor: Wealth-Income Ratios in Switzerland over the 20th Century and the Role of Housing Prices

Enea Baselgia and Isabel Z. Martínez ()
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Isabel Z. Martínez: KOF Swiss Economic Institute, ETH Zurich, Switzerland
Authors registered in the RePEc Author Service: Isabel Z. Martínez

No 20-487, KOF Working papers from KOF Swiss Economic Institute, ETH Zurich

Abstract: We estimate the ratio of private wealth to national income, βpt, for Switzerland over the period 1900–2018. Our results indicate that the development of βpt in Switzerland did not follow a U-shaped pattern as in most European countries, but that the evolution was extraordinarily stable, with βpt oscillating around 500% over most of the 20th century. However, the wealth-income ratio has been on the rise since the turn of the century to reach 721% in 2017 – an unprecedented level in the past. This considerable increase is mainly driven by large capital gains in housing wealth since 2010. We present new cross-country evidence that capital gains in housing wealth have become an important driver of rising wealth-income ratios in a series of developed economies.

Keywords: wealth-income ratio; income distribution; economic growth; housing prices (search for similar items in EconPapers)
JEL-codes: D31 D33 E01 N34 (search for similar items in EconPapers)
Pages: 77 pages
Date: 2020-12
New Economics Papers: this item is included in nep-eur, nep-his and nep-mac
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Citations: View citations in EconPapers (1)

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Working Paper: A Safe Harbor: Wealth-Income Ratios in Switzerland over the 20th Century and the Role of Housing Prices (2020)
Working Paper: A Safe Harbor: Wealth-Income Ratios in Switzerland over the 20th Century and the Role of Housing Prices (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:kof:wpskof:20-487

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