Accumulation, inheritance and wealth distribution: first estimates of the untold half

Mauricio De Rosa ()
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Mauricio De Rosa: Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía

No 22-07, Documentos de Trabajo (working papers) from Instituto de Economía - IECON

Abstract: While wealth accumulation and its distribution are arguably two of the key drivers of overall economic inequality and of major importance in their own right, very little is known about them in the developing world. I contribute to filling this gap by providing micro-macro consistent series of aggregate wealth and its distribution in Uruguay. The country's balance sheet, which is not estimated by official institutions, is constructed for the first time by combining a wide array of data sources, reaching a wealth to income ratio of 500%. Private wealth distribution is then estimated based on the capitalization method, taking stock of combined survey-tax-national accounts micro-data, resulting in a top 1% of 38-40%. Estimates are systematically compared with results based on the estate multiplier method, real estate wealth tax, household wealth survey and Forbes billionaires list. Moreover, the inheritance flow is estimated, reaching 9-10% throughout the period, consistent with a 60% inheritance stock. These estimates represent the first coherent and comparable depiction of wealth and its distribution for a Latin American country, hence providing insights to a completely unknown reality thus-far.

Keywords: wealth distribution; wealth to income ratios; capitalization method; tax records; national accounts; developing countries; Uruguay (search for similar items in EconPapers)
JEL-codes: D31 E01 E22 (search for similar items in EconPapers)
Pages: 88 pages
Date: 2022-05
New Economics Papers: this item is included in nep-fdg and nep-lam
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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https://hdl.handle.net/20.500.12008/31901

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Persistent link: https://EconPapers.repec.org/RePEc:ulr:wpaper:dt-07-22

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