The Concentration of Personal Wealth in Italy 1995-2016

83 Pages Posted: 14 May 2021

See all articles by Paolo Acciari

Paolo Acciari

Ministry of Economy and Finance, Italy

Facundo Alvaredo

Ecole Normale Superieure (PSE-ENS)

Salvatore Morelli

The Graduate Center - CUNY

Date Written: April 1, 2021

Abstract

Italy is one the countries with the highest wealth-to-income ratio in the developed world. Yet, despite the growing policy interest, knowledge about the size distribution of wealth is currently limited. In this paper, we expand our windows of observation on the distribution of personal wealth using a novel source on the full record of inheritance tax files. The data cover up to 63% of the deceased population and are available between 1995 and 2016, a period of substantial economic turbulence and structural reform for the Italian economy. Our benchmark results rely on the distribution of the net wealth observed in the National Accounts balance sheets. Unlike available statistics estimated from household survey data, our results point to a strong rise in wealth concentration and inequality since the mid-1990s. Whereas the level of wealth concentration in Italy is in line with those of other European countries, its time trend appears more in line with the U.S. experience. Moreover, Italy stands out as one of the countries with the strongest decline in the wealth share of the bottom 50% of the adult population. We explore the role of household wealth portfolios, accumulation patterns during the life cycle, and inheritance flows, its concentration, and taxation patterns as main drivers of the trends observed. A range of alternative series of wealth concentration helps us better understand the role of adjustments and imputations and is based on a multi-series approach, i.e., comparing the pieces of information given by different and competing sources.

JEL Classification: D3, G50, H24, N3

Suggested Citation

Acciari, Paolo and Alvaredo, Facundo and Morelli, Salvatore, The Concentration of Personal Wealth in Italy 1995-2016 (April 1, 2021). CEPR Discussion Paper No. DP16053, Available at SSRN: https://ssrn.com/abstract=3846140

Paolo Acciari (Contact Author)

Ministry of Economy and Finance, Italy ( email )

Via XX Settembre 97
Rome, Rome 00187
Italy

Facundo Alvaredo

Ecole Normale Superieure (PSE-ENS) ( email )

48 Boulevard Jourdan
75014 Paris
France

Salvatore Morelli

The Graduate Center - CUNY ( email )

695 Park Avenue
New York, NY 10021
United States

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