There have been important studies of overall income inequality and of poverty in South Africa. In this paper, we approach the subject from a different direction: the extent and evolution of top ...incomes. We present estimates of the shares in total income of groups such as the top 1 per cent and the top 0.1 per cent, covering, with gaps, more than a hundred years. In order to explain the observed dynamics, here we consider three factors: the transfer of political authority, racial discrimination, and the rich mineral resources. The estimates of top income shares for recent years bear out the picture of South Africa as a highly unequal country.
The monetary method is a widely used approach to measure the size of the shadow economy. It is based on the hypothesis that cash is used to make transactions that agents want to keep hidden from ...official records. This paper (i) provides a formal aggregation framework which stylizes the steps usually followed in empirical applications and makes clear the assumptions required by this method, (ii) demonstrates that the method has been used implicitly assuming that the income-elasticity of currency demand is one even in those cases in which its econometric estimate is not one, (iii) shows that when the money demand function used to estimate the size of the shadow economy includes the lagged dependent variable, the need to assume a known initial condition reappears, as it was the case in the early monetary method.
This paper presents series on top shares of income and wealth in Spain over the 20th century using personal income and wealth tax return statistics. Top income shares are highest in the 1930s, fall ...sharply during the first two decades of the Franco dictatorship, and have increased slightly since the 1960s, and especially since the mid-1990s. The top 0.01% income share in Spain estimated from income tax data is comparable to estimates for the United States and France over the period 1933-1971. Those findings, along with a careful analysis of all published tax statistics, suggest that income tax evasion and avoidance among top income earners in Spain before 1980 was much less prevalent than previously thought. Wealth concentration has been about stable from 1982 to 2004 as surging real estate prices have benefited the middle class and compensated for a slight increase in financial wealth concentration in the 1990s. We use our wealth series and a simple conceptual model to analyse the effects of the wealth tax exemption of stocks for ownersmanagers introduced in 1994. We show that the reform induced substantial shifting from the taxable to tax exempt status. This shifting has eroded the wealth tax base substantially and hence the tax exemption has generated large efficiency costs.
There have been important studies of overall income inequality and of poverty in South Africa. In this paper, we approach the subject from a different direction: the extent and evolution of top ...incomes. We present estimates of the shares in total income of groups such as the top 1 per cent and the top 0.1 per cent, covering, with gaps, more than a hundred years. In order to explain the observed dynamics, here we consider —in a preliminary way— three factors: the transfer of political authority, racial discrimination, and the rich mineral resources. The estimates of top income shares for recent years bear out the picture of South Africa as a highly unequal country..
This paper presents series on top shares of income and wealth in Spain over the 20th century using personal income and wealth tax return statistics. Top income shares are highest in the 1930s, fall ...sharply during the first two decades of the Franco dictatorship, and have increased slightly since the 1960s, and especially since the mid-1990s. The top 0.01% income share in Spain estimated from income tax data is comparable to estimates for the United States and France over the period 1933-1971. Those findings, along with a careful analysis of all published tax statistics, suggest that income tax evasion and avoidance among top income earners in Spain before 1980 was much less prevalent than previously thought. Wealth concentration has been about stable from 1982 to 2004 as surging real estate prices have benefited the middle class and compensated for a slight increase in financial wealth concentration in the 1990s. We use our wealth series and a simple conceptual model to analyse the effects of the wealth tax exemption of stocks for owners managers introduced in 1994. We show that the reform induced substantial shifting from the taxable to tax exempt status. This shifting has eroded the wealth tax base substantially and hence the tax exemption has generated large efficiency costs.
A widely applied approach to measure the size of the shadow economy, known as the "monetary method" or the "currency approach," is based on econometric estimates of the demand for money. These ...estimates are used to get the currency held by economic agents in excess of the amount they need to finance registered transactions. This excess of currency multiplied by the income-velocity of circulation (assumed to be equal in the registered and shadow economies) gives a measure of the hidden GDP. This paper shows that the monetary method only produces coherent estimates if the income-elasticity of the demand for currency is one and suggests a way to correct the estimated size of the shadow economy when such elasticity is not one. The correction is applied to existent measures for different countries. Copyright 2007 The Authors; Journal compilation International Association for Research in Income and Wealth 2007.
The share of income received by the top 1% of earners varied markedly between 1900 and 2008 in 24 developed and developing economies. Moreover, the biggest earners changed as well. When the century ...began, the top 1% was dominated by capital owners. By the end of the century the hired hands -- the top executives --shared with capital owners the highest part of the income distribution. In Western English-speaking countries, inequality declined until about 1980 and then began to grow again. Continental European countries and Japan had a decline until about 1950; since then income distribution has leveled. For Nordic and Southern European countries, the drop in inequality in the early part of the century was much more pronounced than the rebound in the late part of the period. In the US, average real incomes grew at a 1.3% annual rate between 1993 and 2008. But if the top 1% is excluded, average real income growth is almost halved, to about 0.75% a year.
A commonly used approach to measure the size of the shadow economy, known as "the monetary method", is based on econometric estimates of the demand for currency. These estimates are used to get the ...currency held by economic agents in excess of the amount they need to finance registered transactions. This excess of currency multiplied by the income-velocity of circulation (assumed to be equal in the registered and shadow economies) gives a measure of the hidden GDP. This paper shows that the monetary method only produces coherent estimates if the income-elasticity of the demand for currency is one and suggests a way to correct the estimated size of the shadow economy when such elasticity is not one. The correction is applied to existent measures for different countries.
The "monetary method" to measure the size of the shadow economy is based on econometric estimates of the demand for currency. These estimates are used to reckon the currency held by economic agents ...in excess of the amount they need to finance registered transactions. This excess of currency multiplied by the income-velocity of circulation (assumed to be equal in the registered and the shadow economies) allows measuring unregistered GDP (the size of the shadow economy).
