THE DISTRIBUTION OF PUBLIC EXPENDITURES AND TAXES AMONG HOUSEHOLDS IN THE UNITED KINGDOM*

This paper presents an analysis of the distributive impact of public expenditures and taxes in the United Kingdom. The analysis uses household level microdata from the 1971 Family Expenditure Survey, with tax and expenditure aggregates drawn from the national accounts. The analysis is the first to allocate all taxes and public expenditures for the United Kingdom, and the results are compared to those from the more restricted analyses carried out by the U.K. Central Statistical Office. Results are presented for individual taxes and benefits as well as for overall net benefits and they describe distributional effects with respect to income class, household size, number of earners and housing tenure. A final section of the paper compares the results to those from a similar analysis for the United States which were reported in the previous issue of this review.     

RETIREMENT INCOME RIGHTS AS A COMPONENT OF WEALTH IN THE UNITED STATES*

Americans have accumulated a considerable amount of future purchasing power in the form of Social Security and employer pension rights. These rights are a form of wealth. In this paper, we ask how their inclusion alters the wealth portfolios of a sample of Americans at or nearing normal retirement age. Data from the 1973 wave of the longitudinal Retirement History Study suggest that, for many Americans, retirement income rights are the dominant component of wealth, and are often more important than all other entries combined, including home equity. We also find that this wealth can be seriously eroded during times of high inflation. Because of differences in marketability, pension and Social Security rights are not perfect substitutes for more liquid assets. Nonetheless, since they are so large in magnitude, and have been shown to be key determinants of the behavior of older workers, they should not be ignored.     

EDUCATION AND THE NATIONAL WEALTH OF THE UNITED STATES*

Human capital theory has motivated a great many empirical investigations into the relationship between education and earnings potential. These studies test refinements of the theory, but do not attempt to value education for the economy as a whole. This study develops series which track human wealth and its educational components for the United States from 1946 to 1980. Three related educational time sequences emerge: (1) schooling wealth, the present value of the current and future contributions of the existing schooling stock to national income; (2) net change in schooling wealth, the amount added to present value in that year; and (3) schooling investment, the present value of the future contributions of the new schooling conducted in that year. One important lesson of this exercise is that the last two series can be quite different as a result of the pattern of appreciation and depreciation of human wealth over the lifetimes of individuals. Moreover, education increases the age of peak human wealth and thus should shorten the period during which individuals save for retirement. This phenomenon may induce a demographic cycle in the nation's savings rate, especially evidenced with the aging of the baby-boom cohort. The magnitudes of the human and schooling wealth estimates are large when compared to financial wealth. For a 4 percent rate, the period-wide average for human wealth is five times-and schooling wealth 2.6 times-the Federal Reserve Board's measure of household net worth. These estimates are naturally sensitive to the discount rate chosen, but show that the gap between human and financial wealth has been widening and that the value of schooling provided in any year greatly exceeds its cost. Schooling represents a form of saving whose value is several times the conventional measure of saving.     

THE SIZE DISTRIBUTION OF HOUSEHOLD DISPOSABLE WEALTH IN THE UNITED STATES

In this study, new estimates are presented of the size distribution of household wealth in the U.S. in 1969. Compared to previous studies, its major advance is the inclusion of all marketable or discretionary household assets and liabilities and their alignment with national balance sheet totals. Household disposable wealth (HDW) is defined as the sum of all marketable or fungible assets held by households less liabilities. The Gini coefficient for HDW is 0.72, the share held by the richest one percent of households is 31 percent, and the share held by the top five percent is 49 percent. There is, however, a large variation in the concentration of different household assets. The Gini coefficient is 0.30 for household durables and inventories, 0.69 for equity in owner-occupied housing, 0.94 for bonds and securities, and 0.98 for corporate stock. HDW is then divided into two mutually exclusive components. The first, called "life-cycle wealth," is defined as the sum of equity in owner-occupied housing, durables, household inventory, demand deposits and currency, and the cash value of life insurance and pensions less consumer debt. This form of wealth tends to be accumulated over the life-cycle for either consumption, liquidity, or retirement purposes. The second, called "capital wealth," is the sum of time and savings deposits, bonds and securities, corporate stock, business and investment real estate equity, and trust fund equity. Life-cycle wealth is substantially less concentrated than capital wealth. The Gini coefficient for it is 0.59, while that for capital wealth is 0.88. Moreover, among the lower wealth groups, over 80 percent of household wealth takes the form of life-cycle wealth, whereas among the top wealth groups the proportion is under 20 percent. The results suggest substantially different savings motivations between the two groups.     

PERSONAL SECTOR WEALTH IN THE UNITED KINGDOM, 1920–56

In the United Kingdom there is a wide range of sources which make it possible to construct a series for components of personal wealth for the period 1920–56. The data are consistent with contemporary estimates produced for specific years in the 1920s and 1930s. They indicate that a stock-market boom and the effects of deflation and low interest rates on the nominal value of the national debt took the wealth/income ratio in the mid-1930s to a level not seen again until the housing boom of the 1980s.     

A COMPARATIVE ANALYSIS OF HOUSEHOLD WEALTH PATTERNS IN FRANCE AND THE UNITED STATES

We find that household wealth is distributed more unequally in the U.S. in 1983 than France in 1986. The Gini coefficient is 0.77 for the U.S. and 0.71 for France. There are also significant differences in the composition of wealth. Owner-occupied housing accounted for half of total assets in France, and only 30 percent in the U.S., while corporate stock and financial securities amounted to 19 percent in the U.S. and 8 percent in France. The debt-equity ratio was 0.13 in France and 0.20 in the U.S. The age-wealth profile in the two countries had the characteristic hump-shape predicted by the life-cycle model, but the profile was much flatter in France and peaked for families aged 50–59 in France, compared to 60–69 in the US.     

DISTRIBUTION OF WEALTH IN AUSTRALIA*

This paper discusses the distribution of wealth derived from the Australian Survey of Consumer Finances and Expenditures, 1966-68, carried out jointly by Macquarie University and the University of Queensland. It analyzes the composition of net worth, assets, and liabilities by socio-demographic characteristics and over time.     

ON THE SIZE DISTRIBUTION OF WEALTH IN CANADA*

This paper is concerned with measurement of the size distribution of personal wealth in Canada. The only available estimates of this distribution are those provided on the occasions when Statistics Canada's Survey of Consumer Finance has surveyed assets and debts. Results of the latest “SCF” to do this, that of 1977, are not yet available. The paper shows that the previous study, conducted in 1970, indicated wealth-inequality as viewed by top quantile shares roughly of the same order as estimated by others for the U.S. and U.K. A comparison of asset and debt aggregates implied by the survey, however, with independent totals indicates that for almost all items the SCF likely under-estimated true holdings. The possible relative importance of sampling and non-sampling errors in explaining this distortion is considered, drawing on Monte Carlo evidence and American validation studies of survey response. It is concluded that sampling error is unlikely to provide the explanation for SCF discrepancies in aggregates, but that non-sampling error is capable of doing so. Finally the 1970 SCF distribution of wealth is re-estimated. First a correction is made for hypothetical differential response according to true net worth. Second an attempt is made to remove the effects of under-reporting by respondents. The “best-guess” re-estimated distribution exhibits mean net worth considerably greater than shown by the SCF but only a slightly greater degree of concentration. Under certain fundamental assumptions this result is surprisingly robust. The appropriate conclusion is not that survey estimates of the distribution of wealth are reliable, but that the strong non-sampling errors affecting the 1970 Canadian SCF wealth estimates may have been composed of almost completely offsetting sources of bias.     

THE DISTRIBUTION OF INCOME AND WEALTH IN JAPAN

This paper reviews research on the distribution of income and wealth in Japan, identifies sources of data on income and wealth, and describes limitations of these data. Evidence that Japan's poorest income groups are relatively well-off is convincing, but there is less evidence that the overall distribution of income in Japan is more equal than in other OECD countries. Agricultural policy, social welfare policy, the tax system, trends in earnings differentials, and the role of the Japanese family are among the many factors that have shaped Japan's income distribution. The rapid appreciation of the stock market and land prices during the late 1980s led to greater inequality in the distribution of wealth. Rapid population aging is expected to lead to an increase in total national wealth relative to national income which may have an adverse impact on the distribution of income.     

DEVELOPMENT OF ESTIMATES OF THE STOCK OF FIXED CAPITAL IN THE UNITED KINGDOM*

The historical background and present methodology used in compiling the U.K. official estimates of the stock of fixed capital are described. Mention is made of the possibility that with the development of commercial accounting direct estimates of capital stock may be derived from enterprise accounts at some future time. For the present, however, an indirect perpetual inventory approach is followed. Some of the deficiencies of the present estimates are discussed including the effects of possible biases in the life-length assumptions, price indices and the treatment of secondhand assets. Estimates of gross capital stock are given analysed by industry group of ownership and by type of asset. Some conceptual issues are discussed in relation to user requirements, including the distinction between the stock of capital and the flow of services from it. The authors conclude that little can be done to improve the perpetual inventory estimate of fixed capital in the U.K. without devoting more resources to the collection and analysis of new information, particularly on the service lives of fixed assets, the extent of leasing and the transfer of assets between industries.     

人工智能的财富分配效应研究

人工智能对经济不平等的影响引起学术界的广泛重视,但是现有研究以分析其对劳动收入不平等的影响为主,关于人工智能对财富分配从而对财产性收入不平等影响的相关研究尚有欠缺。本文通过构建一个连续时间异质性个体动态一般均衡模型,将人工智能对生产技术的影响看作一揽子偏向性技术进步,研究人工智能技术对财富分配的影响。分析发现,人工智能对财富不平等的影响在短期和长期表现有所不同,短期中人工智能技术的应用会提高经济中财富分配不平等程度,而长期中其财富分配效应则取决于人工智能对不同类型技术进步的促进程度。核心机制在于,人工智能技术进步的多样性在短期和长期中对资本回报率产生不同影响,短期中各类技术进步总是会提高资本回报率,而在长期,不同类型的技术进步对资本回报率的影响出现差异。基于以上结论,本文就我国如何在应用人工智能促进增长的同时预防不平等程度扩大提出了政策建议。     

THE PRESIDENT'S COMMISSION ON PENSION POLICY HOUSEHOLD SURVEY 1979: NET WEALTH DISTRIBUTIONS BY TYPE AND AGE FOR THE UNITED STATES

A household survey was done for the U.S. President's Commission on Pension Policy (1979-81). This paper reports on the net wealth of families in the United States for the year 1979, the first wave of the survey. The survey was begun in September 1979 and was a two-wave, nationwide random sample of households in the United States. The survey instrument gathered information on income, wealth, labor supply, participation in pension plans, vesting status, entitlement to various benefits, attitudinal views on retirement, social security wealth, and individual demographic characteristics. Details of the survey methodology are reported. A response rate of sixty-two percent was achieved among the 6,384 dwelling units in the first wave. Imputations are made to calculate the wealth embodied in private and public employee-based pensions. Included in this valuation is an adjustment for expected vesting status in the pension plan. Net wealth is examined by type and age of the head of household. The average net wealth of the family is $53,956, and the average value of retirement wealth is $3,281 which comprises about 5 to 6 percent of net wealth. The striking changes in the portfolio of net wealth are depicted over the cross-section of age cohorts. The oldest age cohort, 65 and over, is found to have for retirement wealth the lowest frequency of ownership, the lowest proportion of their portfolio in this form of wealth, and the second to lowest average value.     

WEALTH DISTRIBUTION AND INVESTMENT INCOME IN BRITAIN*

This paper examines two different approaches to the estimation of the size distribution of wealth. The first section describes new estimates for the distribution in Britain in 1968 using the estate method and discusses the sensitivity of the results to the main assumptions. The second section presents preliminary estimates using the investment data, a method which has not been widely used. In the final section the results obtained for the upper tail of the distribution from the two methods are compared.     

THE DISTRIBUTION OF WEALTH IN CANADA

For estimates of the wealth distribution Canada depends on household surveys taken at 6–7 year intervals. The latest data from this source refer to household balance sheets in the spring of 1977. A comparison with 1970 shows that there is little change in the composition of wealth held by households but that inequality of the wealth distribution has been somewhat reduced. Wealth data by age of family head is presented in order to describe more fully the wealth distribution and composition in Canada.
Weaknesses in the data are discussed as well as the difficulties of making appropriate adjustments to the data at the micro record level. For policy evaluation and formulation purposes the lack of comprehensive estimates inclusive of pension wealth as well as the small sample size (12,700 usable records) have been perceived as greater obstacles to utilizing the data than the underestimate in aggregate assets and debts which affects more the higher than the middle and lower ranges of the wealth distribution.