cover image: Working Paper No. 2024-01 - Simulating Long-Run Wealth Distribution and Transmission:


Working Paper No. 2024-01 - Simulating Long-Run Wealth Distribution and Transmission:

17 Jan 2024

We then calibrate the original IT-SILC sample weights following Deville and Särndal (1992)’s raking procedures to improve the representativeness of a series of sociodemo- graphic characteristics and gross income distributions relating to the end of the 2015 year.1 To allow for the easy use of alignment procedures within the model, the last step involves the expansion of the sample by duplicating. [...] The alignments ensure the stability of the model in the long-run, for instance by keeping the level of employment in line with projections, while also setting the macroeconomic path of the modeled economy, e.g. [...] As already mentioned, the average savings rate in the model is decreasing in the simulation time span, following an historical trend.10 Still, the propensity to save depends on household characteristics, such as the level of household income, financial wealth, the number of components and income earners as well as the age of the head of household and whether the head of household is retired or not. [...] 4.1 The role of IGTs in wealth accumulation In this paragraph we expand on the intergenerational factor by describing its modelling within the Wealth module of T-DYMM and the interactions with the rest of the processes. [...] Then, the simu- lation provides evidence on the significant reduction in wealth inequality that would occur with the implementation of the French inheritance and gift taxation: the Gini index, in the latter case, would not overcome the value of 0.66 in 2070, four Gini points below the inequality of the baseline scenario.


Paul Simpkins

Published in
United Kingdom