Are survey data underestimating the inequality of wealth?

Jaanika Meriküll and Tairi Room

Empirical Economics, 2022, vol. 62, issue 2, No 2, 339-374

Abstract: Abstract This paper studies households’ response behaviour in a wealth survey. We analyse how unit non-response and item non-response contribute to the estimated distribution of wealth. Our findings imply that wealth inequality is underestimated in the survey. The downward bias is originating from item non-response and not from unit non-response. Wealthier households are less likely to provide answers to wealth-related questions. As a result, the level of net wealth is underestimated and the top tail of its distribution is missing. Imputation can eliminate biases throughout most of the wealth distribution but does not recover the estimates in the top tail.

Keywords: Wealth distribution; Unit non-response; Item non-response; Participation bias; Wealth survey; Wealth inequality; Household Finance and Consumption Survey; Estonia (search for similar items in EconPapers)
JEL-codes: D31 E21 (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (3)

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Working Paper: Are survey data underestimating the inequality of wealth? (2019)
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DOI: 10.1007/s00181-021-02030-6

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