Econometric analysis of the composition and distribution of private wealth in Germany

• Applicant: Professor Dr. Martin Biewen
• Subject Area: Statistics and Econometrics
• Term: from 2013 to 2018
• Project identifier: Deutsche Forschungsgemeinschaft (DFG) - Project number 246178444

Besides income, wealth is one of the economic quantities that is of central importance for the structure of the economy and the distribution of its material resources. Given its great importance for economic policy and the assessment of the investment decisions of households, the question of the distribution and structure of private wealth in Germany has received surprisingly little attention in the literature. The goal of the present research project is to use modern econometric methods and hitherto underused data bases (the SAVE and the PHF data bases) in order to generate new insights into the distribution and composition of private wealth in Germany. In a first module, we aim to investigate the influence of a variety of individual and household characteristics on the composition of German household portfolios. We are particularly interested in the effect of explanatory variables such as the composition of the household with respect to gender, the number of children, educational qualifications, health status, labor market history, attitudes towards risk, expectations and old-age savings decisions on the portfolio shares of different wealth components. Given the panel structure of our databases, we will be able to employ modern panel methods for this purpose. In a second module, we aim to model and analyze the structure and inequality of the distribution of overall private wealth in Germany. As in the case of the first module, this will allow us to gain new insights into the distribution of material resources in Germany, its development over time, and to compare our results to those based on alternative data sources on private wealth.

• DFG Programme: Research Grants