Premium
THE INEQUALITY OF WEALTH I N BRITAIN'S NORTH AMERICAN COLONIES: THE IMPORTANCE OF THE RELATIVELY POOR
Author(s) -
Osberg Lars,
Siddiq Fazley
Publication year - 1988
Publication title -
review of income and wealth
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.024
H-Index - 57
eISSN - 1475-4991
pISSN - 0034-6586
DOI - 10.1111/j.1475-4991.1988.tb00565.x
Subject(s) - inequality , nova scotia , wealth distribution , distribution of wealth , economics , distribution (mathematics) , national wealth , wealth elasticity of demand , population , demographic economics , wealth effect , real estate , demography , geography , mathematics , macroeconomics , sociology , finance , mathematical analysis , archaeology , monetary policy
This paper presents original estimates of the distribution of personal wealth in Nova Scotia, Canada in 1871 using the estate multiplier technique and discusses the sensitivity of estimates of the wealth distribution to the assumed wealth holdings of non‐probated decedents. We examine, in particular, the implications of assuming: (1) that non‐probated decedents had zero wealth, (2) that the wealth distribution was quasi‐Paretian (with parameters that can be estimated from the distribution of wealth of probated decedents) or (3) that the wealth distribution had the form assumed by A. H. Jones in her analysis of wealth inequality in the Thirteen Colonies in 1774. We conclude that it is unlikely that large estates escaped the probate process in Nova Scotia, but it is also unlikely that all non‐probated decedents had equal wealth‐thus our “best guess” is that the wealth distribution of non‐probated decedents was quasi‐Paretian. However, a methodology similar to Jones' would have implied considerably less measured inequality in the wealth distribution and greater average wealth in 1871– and would therefore have altered our perception of long term trends in the distribution of wealth and in the rate of accumulation of wealth. The measurement of wealth inequality in a society with a significant slave population, such as the thirteen colonies in 1774, is also highly sensitive to the treatment of slavery. Our preferred estimates of wealth inequality in Nova Scotia in 1871 and in the Thirteen Colonies in 1774 indicate a much higher inequality in the distribution of personal wealth than exists today.