Hostname: page-component-586b7cd67f-rcrh6 Total loading time: 0 Render date: 2024-11-28T14:06:07.005Z Has data issue: false hasContentIssue false
  • English
  • Français

Patterns and Determinants of Wealth Inequality in Late-Nineteenth-Century Ontario

Evidence from Census-Linked Probate Data

Published online by Cambridge University Press:  04 January 2016

Livio Di Matteo
Get access Rights & Permissions [Opens in a new window]

Extract

This article shows that late-nineteenth-century wealth inequality was associated with rising wealth levels supporting the existence of a Kuznets-type curve, but this curve is not unconditional.The tendency of wealth inequality to vary with age means that wealth inequality was also a function of the changing age composition of the population and may have been the result of portfolio allocation decisions across the life cycle. Canada's population “aged” during the late nineteenth century, with the proportion of population under age 20 dropping from 53% in 1871 to 43% by 1911. The general aging of the population could have increased inequality in both wealth and income. These results follow recent work by Jeffrey Williamson (1998), who argues that Kuznets curves are not unconditional. In other words, as the results of this article confirm, wealth inequality is the outcome of a complex economic process, not a single determinant cause.

Type
Articles
Information
Social Science History , Volume 25 , Issue 3 , Fall 2001 , pp. 347 - 380
Copyright
Copyright © Social Science History Association 2001 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Ahluwalia, M. (1976) “Inequality, poverty, and development.” Journal of Development Economics 3: 307–42.Google Scholar
Alter, George, Goldin, Claudia, and Rotella, Elyce (1994) “The savings of ordinary Americans: The Philadelphia Saving Fund Society in the mid-nineteenth century.” Journal of Economic History 54(4): 735–67.Google Scholar
Anand, S., and Kanbur, S. (1993) “Inequality and development: A critique.” Journal of Development Economics 41: 19–43.Google Scholar
Ando, A., and Modigliani, F. (1963) “The ‘life-cycle’ hypothesis of saving: Aggregate implications and tests.” American Economic Review 53: 55–84.Google Scholar
Atack, J., and Bateman, F. (1981)“Egalitarianism, inequality, and age: The rural North in 1860.” Journal of Economic Histor 41: 85–93.Google Scholar
Beaulieu, E., and Emery, H. (1998) “The economics of indifference: The role of reciprocity in the 1911 General Election and the implications for Green’s puzzle.” Paper presented at theconference Regions in Canadian Growth: A Gathering in Honour of Alan G.Green, Queen's University, Kingston, 6-7 March.Google Scholar
Bolton, S. C. (1982) “Inequality on the southern frontier: Arkansas County in the Arkansas Territory.” Arkansas Historical Quarterly 41(1): 51–66.Google Scholar
Bouchard, G. (1998) “Economic inequalities in Saguenay society, 1879-1949: A descriptive analysis.” Canadian Historical Review 79(4): 660–90.Google Scholar
Brenner, Y. S., Kaelble, H., and Thomas, Mark, eds.(1991) Income Distribution in Historical Perspective. Cambridge: Cambridge University Press.Google Scholar
Burbidge, J. B., and Davies, J. B. (1994) “Household data on saving behavior in Canada,” in Poterba, James M. (ed.) International Comparisons of Household Saving. Chicago: University of Chicago Press: 11–56.Google Scholar
Burchell, Robert A. (1987) “Opportunity and the frontier: Wealth-holding in twenty-six northern Californian counties 1848-1880.” Western Historical Quarterly 18(2): 177–96.Google Scholar
Canada. Dominion Bureau of Statistics (1921) Census of Canada.Google Scholar
Chenery, Hollis, Ahluwalia, Montek S., Bell, C. L. G., Doloy, John H., and Jolly, Richard (1974) Redistribution with Growth. Oxford: Oxford University Press.Google Scholar
Cleveland, W. S. (1979) “Robust locally weighted regression and smoothing scatterplots.” Journal of the American Statistical Association 74: 829–36.Google Scholar
Cleveland, W. S. (1985) The Elements of Graphing. Monterey, CA: Wadsworth.Google Scholar
Cleveland, W. S. (1993) Visualizing Data. Summit,NJ: Hobart.Google Scholar
Cowell, F. A. (1977) Measuring Inequality: Techniques for the Social Sciences. New York: Halsted Press, John Wiley and Sons.Google Scholar
Darroch, G. (1983) “Early industrialization and inequality in Toronto, 1861-1899.” Labour/Le Travailleur 11: 31–61.Google Scholar
Darroch, G., and Soltow, L. (1994) Property and Inequality in Victorian Ontario: Structural Patterns and Cultural Communities in the 1871 Census. Toronto: University of Toronto Press.Google Scholar
Davies, J. (1996) “Wealth inequality and age.” Research report 9613, Department of Economics, University of Western Ontario.Google Scholar
Deininger, K., and Squire, L. (1996) “A new data set measuring income inequality.” World Bank Economic Review 10: 565–91.Google Scholar
Deininger, K., and Squire, L. (1998) “New ways of looking at old issues: Inequality and growth.” Journal of Development Economics 57(2): 259–88.Google Scholar
Di Matteo, L. (1996) “The wealth of the Irish in nineteenth-century Ontario.” Social Science History 20(2): 209–34.Google Scholar
Di Matteo, L. (1997) “The determinants of wealth and asset holding in nineteenth-century Canada: Evidence from micro-data.” Journal of Economic History 57(4): 907–34.Google Scholar
Di Matteo, L. (1998) “Wealth accumulation and the life-cycle in economic history: Implications of alternative approaches to data.” Explorations in Economic History 35(3): 296–324. Erratum, 36(1): 107.Google Scholar
Di Matteo, L., and George, P. (1992) “Canadian wealth inequality in the late nineteenth century: A study of Wentworth County,Ontario, 1872-1902.” Canadian Historical Review 73: 453–83.Google Scholar
Di Matteo, L., and George, P. (1998) “Patterns and determinants of wealth among probated decedents in Wentworth County, Ontario,1872-1902.” Histoire sociale/Social History, 31, 61, 1–34.Google Scholar
Elliott, B. S. (1985) “Sources of bias in nineteenth-century Ontario wills.” Histoire sociale/Social History 18:125–32.Google Scholar
Emery, G. (1993) Facts of Life: The Social Construction of Vital Statistics, Ontario 1869-1952. Montreal: McGill-Queens.Google Scholar
Friedman, M. (1957) A Theory of the Consumption Function. Princeton: Princeton University Press.Google Scholar
Gallman, R. E. (1978) “Professor Pessen on the‘egalitarian myth.’” Social Science History 2: 194–207.Google Scholar
Green, A. G. (1967) “Regional aspects of Canada’s economic growth, 1890-1929.” Canadian Journal of Economics and Political Science 33(2): 232–45.Google Scholar
Green, A. G. (1968/69) “Regional inequality, structural change, and economic growth in Canada.” Economic Development and Cultural Change 17: 567–83.Google Scholar
Green, A. G. (1971) Regional Aspects of Canada’s Economic Growth. Toronto: University of Toronto Press.Google Scholar
Green, A. G., and Sparks, G. R. (1999) “Population growth and the dynamics of Canadian development: A multivariate time series approach.” Explorations in Economic History 36(1): 56–71.Google Scholar
Greenwood, D.T. (1987) “Age, income, and household size: Their relation to wealth distribution in the United States,” in Wolff, Edward N. (ed.) International Comparisons of the Distribution of Household Wealth. New York: Oxford University Press: 121–40.Google Scholar
Gregson, M. E. (1996) “Wealth accumulation and distribution in the Midwest in the late nineteenth century.” Explorations in Economic History 33: 524–38.Google Scholar
Gwyn, J., and Siddiq, F. K. (1992) “Wealth distribution in Nova Scotia during the Confederation Era, 1851 and 1871.” Canadian Historical Review 73(4): 435–52.Google Scholar
Haines, M. R. (1985) “The life cycle, savings, and demographic adaptation: Some historical evidence for the United States and Europe,” in Rossi, A. S. (ed.) Gender and the Life Course. New York: Aldine: 43–64.Google Scholar
Herscovici, S. (1993) “The distribution of wealth in nineteenth-century Boston: Inequality among natives and immigrants,1860.” Explorations in Economic History 30: 321–35.Google Scholar
Higgins, M., and Williamson, J. G. (1999)“Explaining inequality the world round: Cohort size, Kuznets curves, and openness.” National Bureau of Economic Research,Working Paper 7224.Google Scholar
Howell, A. (1880) The Law and Practice as to Probate, Administration, and Guardianship in Surrogate Courts. Toronto: Carswell.Google Scholar
Hurd, M. D. (1987) “Savings of the elderly and desired bequests.” American Economic Review 77: 298–312.Google Scholar
Hurd, M. D. (1990) “Research on the elderly: Economic status, retirement, and consumption and saving.” Journal of Economic Literature 28(2): 565–637.Google Scholar
Inwood, K., and Irwin, J. (1998) “Extending the Green hypothesis: Regional aspects of Canada’s economic growth 1870-90.” Paper presented at the conference Regions in Canadian Growth: A Gathering in Honour of Alan G. Green, Queen’s University, Kingston, 6-7 March.Google Scholar
Jianakopolos, N. A., Menchik, P. L., and Irvine, F. O. (1989) “Using panel data to assess the bias in cross-sectional inferences of life-cycle changes in the level and composition of household wealth,” in Lipsey, R. E. and Tice, H. S. (eds.) The Measurement of Saving, Investment, and Wealth. Chicago: University of Chicago Press: 553–640.Google Scholar
Jones, A. H. (1980) Wealth of a Nation to Be: The American Colonies on the Eve of the Revolution. New York: Columbia University Press.Google Scholar
Katz, M. (1975) The People of Hamilton, Canada West: Family and Class in a Mid-Nineteenth-Century City. Cambridge: Harvard University Press.Google Scholar
Kearl, J. R., and Pope, C. L. (1983) “The Life Cycle in Economic History.” Journal of Economic History 43: 149–58.Google Scholar
Kessler, D., and Masson, A. (1989) “Bequest and wealth accumulation: Are some pieces of the puzzle missing?” Journal of Economic Perspectives 3: 141–52.Google Scholar
King, M. (1985) “The economics of saving: A survey of recent contributions,” in Arrow, Kenneth J. and Honkapohja, Seppo (eds.) Frontiers in Economics. Oxford: Basil Blackwell: 227–327.Google Scholar
Kotlikoff, L. J. (1988) “Intergenerational transfers and savings.” Journal of Economic Perspectives 2: 41–58.Google Scholar
Kuznets, S. (1955) “Economic growth and income inequality.” American Economic Review 45(1): 1–28.Google Scholar
Kuznets, S. (1966) Modern Economic Growth Rate, Structure, and Spread. New Haven: Yale University Press.Google Scholar
Lindert, P. H. (1991) “Toward a comparative history of income and wealth,” in Brenner, Y. S., Kaelble, H., and Thomas, M. (eds.) Income Distribution in Historical Perspective. Cambridge. Cambridge University Press: 212–31.Google Scholar
Lindert, P. H., and Williamson, J. G. (1985) “Growth, equality, and history.” Explorations in Economic History 22: 341–77.Google Scholar
Magee, L., Burbidge, J. B., and Robb, A. L. (1991) “Computing kernel-smoothed conditional quantiles from many observations.” Journal of the American Statistical Association 86: 673–77.Google Scholar
Main, J. T. (1983) “Standards of living and the life cycle in colonial Connecticut.” Journal of Economic History 43(1): 159–65.Google Scholar
Malmberg, B. (1994) “Age structure effects on economic growth—Swedish evidence.” Scandinavian Economic History Review 42(3): 279–95.Google Scholar
McInnis, M. (1991) “Women, work, and childbearing: Ontario in the second half of the nineteenth century.” Histoire sociale/Social History 24: 237–62.Google Scholar
Mirer, T. (1979) “The wealth-age relation among the aged.” American Economic Review 69: 435–43.Google Scholar
Mitchell, B. R. (1992) International Historical Statistics: Europe 1750-1988. New York: Stockton Press.Google Scholar
Mitchell, B. R. (1993) International Historical Statistics: The Americas 1750-1988. New York: Stockton Press.Google Scholar
Modigliani, F. (1988) “The role of intergenerational transfers and life cycle saving in the accumulation of wealth.” Journal of Economic Perspectives 2: 15–40.Google Scholar
Neufeld, E. P. (1972) The Financial System of Canada. Toronto: Macmillan.Google Scholar
Newell, W. H. (1980) “The wealth of testators and its distribution: Butler County Ohio, 1803-65,” in Smith, James D. (ed.) Modeling the Distribution and Intergenerational Transmission of Wealth. Chicago: University of Chicago Press: 95–138.Google Scholar
Newell, W. H. (1986) “Inheritance on the maturing frontier: Butler County, Ohio, 1803-1865,” in Engerman, S. L. and Gallman, R. E. (eds.) Long-Term Factors in American Economic Growth. Chicago: University of Chicago Press: 261–303.Google Scholar
Osberg, L., and Siddiq, F. K. (1988) “The inequality of wealth in Britain’s North American colonies: The importance of the relatively poor.” Review of Income and Wealth, 34th ser., 2: 143–63.Google Scholar
Osberg, L., and Siddiq, F. K. (1993) “The acquisition of wealth in Nova Scotia in the late nineteenth century.” Research in Economic Inequality 4: 181–202.Google Scholar
Osborne, B. S. (1980) “Wills and inventories: Records of life and death in a developing society.” Families 19: 235–47.Google Scholar
Pomfre, R. (1993) The Economic Development of Canada. 2nd edition. Scarborough: Nelson.Google Scholar
Pope, C. L. (1989) “Households on the American frontier: The distribution of income and wealth in Utah 1850-1900,” in Galenson, David W. (ed.) Markets in History: Economic Studies of the Past. Cambridge: 148–89.Google Scholar
Ransom, Roger L., and Sutch, Richard (1986) “The life-cycle transition: A preliminary report on wealth holding in America.” Paper prepared for the Tenth University of California Conference on Economic History. Laguna Beach, CA.Google Scholar
Shanahan, M. P., and Correll, M. (1997) “In search of Kuznets’s curve: A reexamination of the distribution of wealth in the United States between 1650 and 1950.” Paper presented at the Third World Congress of Cliometrics, Munich,10-1 July.Google Scholar
Shearer, R. A., Chant, J., and Bond, D. E. (1995) Economics of the Canadian Financial System: Theory, Policy, and Institutions. 3rd edition. Scarborough: Prentice-Hall.Google Scholar
Shorrocks, A. F. (1975a) “The age-wealth relationship: A cross-section and cohort analysis.” Review of Economics and Statistics 57: 159–63.Google Scholar
Shorrocks, A. F. (1975b) “On stochastic models of size distribution.” Review of Economic Studies 42: 631–41.Google Scholar
Siddiq, F. K. (1988) “The size distribution of probate wealth holdings in Nova Scotia in the late nineteenth century.” Acadiensis 18(1): 136–47.Google Scholar
Siddiq, F. K., and Gwyn, J. (1991) “The importance of probate inventories in estimating the distribution of wealth.” Nova Scotia Historical Review 11: 103–17.Google Scholar
Soltow, L. (1975) Men and Wealth in the United States, 1850-1870. New Haven: Yale University Press.Google Scholar
Soltow, L. (1979) “Inequality amidst abundance: Land ownership in early-nineteenth-century Ohio.” Ohio History 88(2): 133–51.Google Scholar
Sutch, R. (1991) “All things reconsidered: The life-cycle perspective and the third task of economic history.” Journal of Economic History 51(2): 271–88.Google Scholar
Wagg, P. (1990) “The bias of probate: Using deeds to transfer estates in nineteenth-century Nova Scotia.” Nova Scotia Historical Review 10: 74–87.Google Scholar
Williamson, J. G. (1965) “Regional inequality and the process of national development.” Economic Development and Cultural Change 13, pt. 2.Google Scholar
Williamson, J. G. (1996) “Globalization and inequality then and now: The late nineteenth and late twentieth centuries compared.” National Bureau of Economic Research, Working Paper 5491.Google Scholar
Williamson, J. G. (1998) “Growth, distribution, and demography: Some lessons from history.” Explorations in Economic History 35(3): 241–71.Google Scholar
Williamson, J. G., and Lindert, P. H. (1980)American Inequality: A Macroeconomic History. New York: Academic Press.Google Scholar