Inequality of Opportunity in Wealth: Levels, Trends, and Drivers

• with Daniel Graeber and Johannes König

• Available at SSRN 5038580

• Best Poster Award at IARIW 2022

• Best Presentation Award at DIW Graduate Center Summer Workshop 2022

We estimate the ex-ante inequality of opportunity in net wealth for Germany using the Socio-Economic Panel. The data allow for a detailed decomposition of inequality into a variety of circumstances; among them childhood background, intergenerational transfers, and regional effects. The ratio of inequality of opportunity to total inequality is stable at more than 60% for the last two decades. The most important circumstances are intergenerational transfers, parental occupation, and the region individuals are born in. We contrast these findings with analogous analyses for earnings. For earnings, gender and individuals' own education are most important.

Presented at:

• European Association of Labour Economists (EALE) 34th European conference, Padova; International Association for Research in Income and Wealth (IARIW) general conference 2022, Luxemburg; 35th annual conference of the European Society for Population Economics (ESPE), Calabria; First European Social Science Genomics Network (ESSGN) conference 2022, Bologna; DIW GC Summer Workshop, Berlin

Industrial Relations and Working from Home in Germany During the COVID-19 Pandemic

• with Laszlo Goerke, Markus Grabka and Yue Huang

• submitted

In this paper, we investigate the role of industrial relations for the extent of working from home during the COVID-19 pandemic in Germany. Using 2020 data from the German Socio-Economic Panel (SOEP) and a special SOEP-CoV sample for 2020 and 2021, we find that employees covered by a collective bargaining agreement work less from home than uncovered individuals. This effect is more pronounced for employees without children and restricted to white-collar workers. Co-determination at plant level is positively associated with working from home, especially in 2021, i.e., the second year of the pandemic, and limited to employees with children and white-collar workers. An employee’s trade union membership does not have an impact.

How to Get Richer: What Machine Learning Can Reveal about Individual Wealth Accumulation

This paper analyzes drivers of individual wealth accumulation using machine learning methods. Wealth accumulation is measured as the absolute difference in individual wealth recorded in two consecutive wealth surveys of the German Socio-Economic Panel (SOEP) in the years 2002, 2007, 2012 and 2017. Random Forests are employed to select and order the most important drivers from a long list of potential mechanisms, like socio-demographics, labor market outcomes, and savings and investment behavior. To gain a more fine-grained understanding of wealth dynamics, different types of wealth holders are defined and their asset-specific wealth growth is analyzed separately. The analyses reveal that while commonly identified drivers of wealth growth (such as income and inheritances) are important, lesser known factors, such as the type and location of real estate or personality traits, are also found to be influential.

Presented at:

• International Institute of Public Finance (IIPF) Annual Congress 2023, Logan/Utah; WATT Workshop "Unveiling Wealth and Income Inequalities" 2023, Berlin;  22nd Journées Louis-Andre Gerard-Varet (LAGV) -- public economics conference 2023, Marseille; Machine Learning in Economics Workshop 2023, Berlin; SOEP User Conference 2024, Berlin

Intragenerational Wealth Mobility: Evidence from Australia and Germany

This paper examines intragenerational wealth mobility in Germany and Australia, two high-income countries with distinct institutional frameworks. Using longitudinal household survey data from longitudinal household surveys, I analyze both relative and absolute wealth mobility over different time horizons. Relative mobility, which captures shifts in individuals’ positions within the wealth distribution, is crucial for understanding economic opportunity and the persistence of inequality. Absolute mobility, in contrast, reflects overall economic progress and broad wealth accumulation. Despite stark differences in institutional settings, I find that relative wealth mobility is remarkably similar in both countries, with rank-rank correlations of approximately 0.7 over a 4- to 5-year period and 0.6 over a 15/16-year horizon. However, absolute mobility is higher in Australia, where 92\% of individuals accumulate more wealth over 16 years compared to 71\% in Germany. These results suggest that relative mobility follows persistent patterns across different institutional settings.

Presented at:

• International Institute of Public Finance (IIPF) Annual Congress 2024, Prague; Workshop on Wealth Inequality, Intergenerational Mobility, and Equality of Opportunity 2024, Vienna