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The Wealth Distribution in Developing Economies: Comparing the United States to Chile

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  • Sofía Bauducco
  • Gonzalo Castex

Abstract

This study examines the differences of income, assets, debt and wealth distributions between the U.S. and Chile. The study uses data from the 2008 Survey of Consumer Finance for the U.S. and data from the 2007 Financial Household Survey from Chile. The article reports different features on inequality among the two countries at the aggregate level but also by head of household demographic characteristics. We find that income and debt are more unequally distributed in Chile than in the US, but assets and wealth are more equally distributed in Chile than in the US. Our results suggest that, among theories that seek to explain wealth inequality in the US, entrepreneurship is the one that seems more plausible.

Suggested Citation

  • Sofía Bauducco & Gonzalo Castex, 2013. "The Wealth Distribution in Developing Economies: Comparing the United States to Chile," Working Papers Central Bank of Chile 702, Central Bank of Chile.
    • Handle: RePEc:chb:bcchwp:702
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    File URL: https://www.bcentral.cl/documents/33528/133326/DTBC_702.pdf
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    References listed on IDEAS

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    6. Mariacristina De Nardi, 2004. "Wealth Inequality and Intergenerational Links," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 71(3), pages 743-768.
    7. David Domeij & Jonathan Heathcote, 2004. "On The Distributional Effects Of Reducing Capital Taxes," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 45(2), pages 523-554, May.
    8. Cagetti, Marco & De Nardi, Mariacristina, 2008. "Wealth Inequality: Data And Models," Macroeconomic Dynamics, Cambridge University Press, vol. 12(S2), pages 285-313, September.
    9. Rodrigo Alfaro & Natalia Gallardo & Roberto Stein, 2010. "The Determinants of Household Debt Defa," Working Papers Central Bank of Chile 574, Central Bank of Chile.
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    11. Carlos Madeira, 2019. "Computing population weights for the EFH survey," Journal Economía Chilena (The Chilean Economy), Central Bank of Chile, vol. 22(1), pages 004-026, April.
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    Cited by:

    1. Felipe Martínez & Francisca Uribe, 2017. "Distribución de Riqueza no Previsional de los Hogares Chilenos," Working Papers Central Bank of Chile 806, Central Bank of Chile.
    2. Felipe Martínez & Francisca Uribe, 2018. "Determinants of Household Position within Chilean Wealth Household’s Distribution," Working Papers Central Bank of Chile 827, Central Bank of Chile.

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