Is wealth driving the income distribution? An Analysis of the link between income and wealth between 1995 and 2016 in Finland

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This article focuses on analysing the role of financial wealth in the generation of income and how it is reflected in the income distribution between households. Piketty believes that we are living in an era of exceptionally narrow income distribution and that due to the increase of financial as well as inherited property; we are entering an era of increasing income distribution. In this article, the same phenomenon is scrutinised but with a conceptually consistent framework in which the national balance sheets are combined with the related income flows. After this, the income flows which are missing from the national income concepts are added. Finally, the household sector income flows are separated and are linked with income distribution data, and these income flows are broken down by income deciles.
The outcome of this analysis is that even though financial wealth in relation to the common wage development has almost doubled, the rates of return have almost halved. Additionally, as the part of the property income flows are received by other economic sectors than the households, the distribution of primary income, i.e. income before redistribution, of different income deciles has not changed significantly in the past twenty years.
TidskriftInternational Association for Official Statistics. Statistical Journal
Sidor (från-till)483-494
Antal sidor12
StatusPublicerad - 19 jun 2020
MoE-publikationstypA1 Tidskriftsartikel-refererad


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