Modeling the Distribution and Intergenerational Transmission by Various, James D. Smith

By Various, James D. Smith

This pioneering quantity makes use of sleek statistical and simulation ideas to give an explanation for the method of wealth transmission and the continual challenge of the unequal distribution of wealth. those papers mirror a shift from the normal cross-sectional dimension to an intertemporal concentration through trying to version mathematically the particular procedure through which wealth is got and transmitted. there are lots of inquiries to be replied: What are the standards influencing saving? what's the function of mating? What comes to a decision possession among spouses? How are infrequent resources allotted through divorce? What are the styles of habit in making presents and bequests? and what's the influence of the relative a long time of the people concerned?

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Additional resources for Modeling the Distribution and Intergenerational Transmission of Wealth (National Bureau of Economic Research - Studies in Income and Wealth, Volume 46)

Example text

Jones (1971, table 5). (7) and (8): New England, decedent wealth. A. H. Jones (1972, table 4, p. 114). Fig. 5 Age and Wealth in the Colonies, 1658-1753. Key: ( I ) Hartford, Connecticut, 1710-14; (2) Hartford, Connecticut, 1750-54; ( 3 ) Connecticut, 1700-1753; (4) Maryland, 16581705. 2. O Fig. 6 I I 30 40 c Age 50 60 Age and Wealth in the Colonies, 1774. Key: ( 1 ) Middle colonies, 1774 (net worth); ( 2 ) New England, 1774 (total and physical wealth); ( 3 ) Middle colonies, 1774 (physical wealth).

The larger the differential in average wealth levels by age, the more potent the effect. In addition, we must consider wealth inequality within age classes. Using 1870 total estate and 1850 real estate census data, Lee Soltow (1975, p. 107) has shown that inequality was high in the age group 20-29, much lower in the age group 30-39, and fairly stable in subsequent age groups. ’:’ What is the colonial evidence on wealth and age? We would be satisfied with either of two kinds of wealth concentration data: (1) measures of wealth concentration over time within fairly narrow age classes; (2) detailed information on changing age distributions which could be combined with our knowledge of age profiles on wealth means and variances.

We know that only a minority of decedent household heads left wills and inventories. We know that the set of decedents for whom no inventory survives includes people from all wealth classes. We also know that the main excluded group is the very poor, who left no inventory because they left no wealth to appraise. The net effect is likely to be an undersampling that is more serious for the poorest classes, producing a probate sampling bias that could make wealth inequality look misleadingly low. Given the extent to which probate records will remain a critical data base in future historical research, it is important that more detailed studies be devoted to cross-checking the probate inventory samples against other primary data identifying the wealth, occupation, and other attributes of the population from which the probates survive.

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