Publication type
Research Paper
Series Number
CASE/166
Series
CASEpapers
Authors
Publication date
December 15, 2012
Summary:
This paper examines trends in the distribution of household wealth in
Great Britain from 1995 to 2005 using the British Household Panel Survey
(BHPS). The data show that wealth is very unevenly distributed and
reveal a widening absolute gap over the period between wealthier
households and those with no or negative wealth. However, in relative
terms, wealth grew fastest for households in the middle of the
distribution and inequality measured by the Gini coefficient decreased.
This mainly reflected housing wealth becoming a greater share of total
net worth, more equally distributed, and the highest percentage increase
in housing wealth taking place in the middle of the distribution. To
estimate the distributional impact of the remarkable rise in house
prices which defined this period, we simulate the distribution of net
2005 wealth in the hypothetical scenario in which house prices remained
at their 1995 levels in real terms and find that the reduction in wealth
inequality is almost entirely accounted for by changes in house prices.
The paper also finds that, controlling for factors such as age,
households that gained most from the house price boom were mortgagors,
in particular those that were initially wealthier, and were advantaged
in other ways such as by level of educational qualification.
Subjects
Link
http://sticerd.lse.ac.uk/case/_new/publications/abstract.asp?index=4146
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