Conference Agenda

This paper provides evidence that asset testing of social transfers substantially depresses the liquid wealth of the poor. Using administrative data on income and wealth for the full population, we estimate the effects of the asset test for an old-age support program in Denmark. We document that the density distribution of liquid wealth exhibits large but diffuse excess mass below the threshold for the low-income elderly relative to control groups of comparable but ineligible individuals. Analyzing high-frequency bank data on assets, spending and cash withdrawals shows that the excess mass largely reflects permanently lower liquid wealth rather than temporary responses.

In this paper, we introduce novel estimates of wealth inequality, integrating the standard household wealth concept with newly assessed individual human capital. Using microdata and national accounts from numerous countries since 1979, we explore the distribution across age, gender, education, and occupation. Our analysis reveals two key findings: human capital is more evenly distributed than financial capital, and total wealth, the sum of human and financial capital, is significantly more equal than financial wealth alone. This study offers a groundbreaking perspective on global wealth dynamics, emphasizing the critical, yet often overlooked, role of human capital in wealth distribution.

The concentration of wealth among the ultra-rich has renewed debates over using wealth taxes to reduce inequality and finance public investments. Traditional measures based on tax records and surveys understate top wealth due to offshore assets, complex holdings, and underreporting. We address this by combining extrapolations from the Wealth Inequality Database (WID) with real-time Forbes billionaire rankings, thereby recalibrating estimates to better capture ultra-wealth. Using Spain’s progressive wealth tax framework as an empirical benchmark, our analysis indicates that a 1.7–3.5% tax on net wealth above the top 0.5% threshold could generate approximately $2.3 trillion annually—roughly 8% of global central government revenues. We also address concerns about behavioral responses; even under scenarios such as billionaire migration, estimated revenues remain robust at $2.2 trillion (7.7% of revenues). Our findings suggest that wealth taxes offer a promising tool to mitigate inequality and fund critical public priorities.

We conduct a comprehensive empirical investigation of the link between inequality and financial openness. We document that the relationship varies considerably not only over time, but also across the main components of total external liabilities, which have been largely overlooked by the existing literature. In emerging market economies (EMEs), an increase in a country’s external liabilities is associated with an initial rise and a subsequent fall in inequality. This appears to be driven by the fact that the channels through which financial openness increases inequality tend to be active immediately, while the inequality-decreasing channels tend to operate with a lag. The link between financial openness and inequality tends to be substantially weaker in advanced economies than in EMEs.