Missing the wealthy in the HFCS: micro problems with macro implications

Sofie Waltl and Robin Chakraborty

The Journal of Economic Inequality, 2022, vol. 20, issue 1, No 8, 169-203

Abstract: Abstract Wealth aggregates implied by the Household Finance and Consumption Survey (HFCS) usually yield much lower amounts than macroeconomic statistics reported in the National Accounts. An important source of this gap may be the under-representation of the wealthiest households in the HFCS. This article therefore combines a semi-parametric Pareto model estimated from top survey data and observations from rich lists with a non-parametric stratification approach to quantify the impact of the missing wealthy households on component-specific micro-macro gaps. We find that unadjusted micro data substantially underestimates wealth inequality. The largest effects are documented for equity. For other components, the missing wealthy explain less than ten percentage points of the micro-macro gap. We find that differences in oversampling strategies limit the cross-country comparability of unadjusted survey-implied wealth distributions and that our top tail adjustment leads to measures that are internationally better comparable.

Keywords: Distributional National Accounts (DINA); HFCS; Micro-macro linkage; Semi-parametric Pareto models; Wealth distribution (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

Downloads: (external link)
http://link.springer.com/10.1007/s10888-021-09519-1 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
Working Paper: Missing the wealthy in the HFCS: micro problems with macro implications (2018)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:joecin:v:20:y:2022:i:1:d:10.1007_s10888-021-09519-1

Ordering information: This journal article can be ordered from
http://www.springer.com/journal/10888

DOI: 10.1007/s10888-021-09519-1

Access Statistics for this article

The Journal of Economic Inequality is currently edited by Stephen Jenkins

More articles in The Journal of Economic Inequality from Springer, Society for the Study of Economic Inequality Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().