Estimating the Distribution of Household Wealth in South Africa

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dc.article.end-page54
dc.article.start-page1
dc.contributor.authorChatterjee, Aroop
dc.contributor.authorCzajka, Léo
dc.contributor.authorGethin, Amory
dc.date.accessioned2022-12-21T10:27:54Z
dc.date.available2022-12-21T10:27:54Z
dc.date.issued2020-04
dc.departmentSouthern Centre for Inequality Studies (SCIS)
dc.description.abstractThis paper estimates the distribution of personal wealth in South Africa by combining tax microdata covering the universe of income tax returns, household surveys and macroeconomic balance sheets statistics. We systematically compare estimates of the wealth distribution obtained by direct measurement of net worth, rescaling of reported wealth to balance sheets totals, and capitalisation of income flows. We document major inconsistencies between available data sources, in particular regarding the measurement of dividends, corporate assets and wealth held through trusts. Both household surveys and tax data remain insufficient to properly capture capital incomes. Notwithstanding a significant degree of uncertainty, our findings reveal unparalleled levels of wealth concentration. The top 10 per cent own 86 per cent of aggregate wealth and the top 0.1 per cent close to one third. The top 0.01 per cent of the distribution (3,500 individuals) concentrate 15 per cent of household net worth, more than the bottom 90 per cent as a whole. Such high levels of inequality can be accounted for in all forms of assets at the top end, including housing, pension funds and other financial assets. Our series show no sign of decreasing wealth inequality since apartheid: if anything, we find that inequality has remained broadly stable and has even slightly increased within top wealth groups.
dc.description.librarianES2022
dc.description.sponsorshipSouthern Centre for Inequality Studies (SCIS)
dc.description.sponsorshipUniversity of the Witwatersrand
dc.facultyFaculty of Commerce, Law and Management
dc.identifier.urihttps://hdl.handle.net/10539/33928
dc.language.isoen
dc.orcid.id0000-0002-4962-7512
dc.orcid.id0000-0002-8338-5270
dc.publisherSouthern Centre for Inequality Studies (SCIS)
dc.publisherUniversity of the Witwatersrand, Johannesburg
dc.relation.ispartofseriesSCIS Working Paper; 3
dc.rights©2020 Southern Centre for Inequality Studies (SCIS)
dc.schoolSouthern Centre for Inequality Studies (SCIS)
dc.subjectWealth Inequality
dc.subjectDistribution of personal wealth in South Africa
dc.subjectTax microdata
dc.subjectIncome tax returns
dc.subjectMacroeconomic balance sheets statistics
dc.subjectCapitalisation of income flows
dc.subjectLevels of wealth concentration
dc.titleEstimating the Distribution of Household Wealth in South Africa
dc.typeWorking Paper
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