The Comfortable, the Rich, and the Super-Rich. What Really Happened to Top British Incomes during the First Half of the Twentieth Century?

Abstract

We examine shifts in British income inequality and their causes from 1911–1949. Using newly rediscovered Inland Revenue income distribution estimates, we show that Britain had an unusually high concentration of personal incomes in 1911 compared to other industrial nations. We also find that Britain’s substantial inequality reduction over the next four decades was largely driven by a collapse in top capital incomes. This parallels findings for France, the United States, and other western countries, that reduced inequality was mainly caused by declining top unearned incomes, owing to economic shocks, policy responses, and non-market mechanisms associated with the retreat from globalization.

Where Is the Middle Class? Evidence from 60 Million English Death and Probate Records, 1892–1992

“…Tracking the "Middle Class," 1892Class," -1992 This article follows existing empirical work on the historical English wealth distribution by Lindert (1986), Atkinson and Harrison (1978), Atkinson, Gordon, and Harrison (1989), and Atkinson (2013). It complements recent work, using a different but related source, by Alvaredo, Atkinson, and Morelli (2018) for wealth, and by Scott and Walker (2020) for top incomes. The individual level data developed here allows for broader claims about the wealth distribution outside the top 10 percent.…”

What Determines the Capital Share Over the Long Run of History?

“…In the early 1910s Paris, foreign financial assets were 20 percent of total wealth (Piketty et al, 2014). Scott and Walker (2020) argue that changing political context regarding foreign investments played a crucial role in leveling income inequality in Britain in the 1910s, but without discussing decolonization. However, the literatures on the macro dynamics of colonial investments and on portfolios of the wealthy suggest that decolonization, a so far overlooked factor in the analysis of the functional income distribution, could indeed have mattered for the capital share.…”