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Wealth-Income Ratios in Free Market Capitalism: Switzerland, 1900-2020

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  • Enea Baselgia
  • Isabel Z. Martínez

Abstract

We estimate the ratio of private wealth to national income, βpt, for Switzerland from 1900 to 2020. Our results indicate that over the 20th century, βpt did not follow a U-shaped pattern as in most European countries. Instead, its was exceptionally stable at around 500%. We argue that this consistently high βpt was the result of geopolitical factors combined with Switzerland’s capital friendly policy-making. Since the turn of the century, however, βpt has been on a rapid rise to reach 793% in 2020. This considerable increase is mainly driven by large capital gains, especially in housing wealth.

Suggested Citation

  • Enea Baselgia & Isabel Z. Martínez, 2022. "Wealth-Income Ratios in Free Market Capitalism: Switzerland, 1900-2020," CESifo Working Paper Series 9976, CESifo.
    • Handle: RePEc:ces:ceswps:_9976
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    More about this item

    Keywords

    wealth-income ratio; distribution; economic growth; housing prices;
    All these keywords.

    JEL classification:

    • N34 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - Europe: 1913-
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D33 - Microeconomics - - Distribution - - - Factor Income Distribution
    • E01 - Macroeconomics and Monetary Economics - - General - - - Measurement and Data on National Income and Product Accounts and Wealth; Environmental Accounts

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