The national wealth of Sweden, 1810–2014

ABSTRACT

This study presents a new database, the Swedish National Wealth Database, which contains annual data on private, public, and national wealth and sectoral saving rates in Sweden over the past two centuries. The paper reviews previous investigations of national wealth, compares their estimates with the ones presented here and discusses method approaches and measurement problems. The main results from data series are presented for assets and liabilities and their subcomponents, for the private and public domestic and foreign sectors. By complementing the past literature with its traditional focus on economic flow variables to understand long-run economic developments, this new database offers potentially new perspectives on a number of important issues in Sweden's economic history.

KEYWORDS:

• National wealth
• household portfolios
• saving
• pension wealth
• economic history

JEL:

• E21
• H31
• N33
• N34

Acknowledgements

I have received valuable comments and data assistance from Tony Atkinson, Lennart Berg, Bo Bergman, Rodney Edvinsson, Henry Ohlsson, Thomas Piketty, Jesper Roine, Lennart Schön, Michael Wolf, two anonymous referees, and seminar participants at Stockholm University, Uppsala University, Statistics Sweden, and the 8th Sound economic history workshop in Uppsala. I am specifically grateful to Bo Bergman, Lennart Berg, Lars Hillerström (CSN), Maria Nilsson (Swedish National Board of Housing, Building and Planning), and Lars Werin for help with data.

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

1 The current web address is www.uueconomics.se/danielw/SNWD.htm (2015–2012).

2 Soltow (1985) used material from this assessment to compute estimates of the distribution of personal wealth in Sweden in 1800.

3 Soltow (1985) examines the 1800 wealth census in a study of personal wealth distribution, but only includes a sample of households and therefore lands at smaller aggregate values.

4 Waldenström (2015b, section F) examines the Swedish wealth-income ratio changes if one switches national income series coming from the different sources. The results suggest overall small effects, but since the recent upgradings of both historical (e.g. adding home production) and current GDP have raised GDP, the main wealth-income ratio is somewhat lower than the ones where other national income series are used.

5 This means that the SNWD does not report the corporate sector balance sheet separately. Note that there may be a deviation between the market value of corporations, shown in households’ market-valued stocks, and the difference between corporate assets and liabilities, that is, when Tobin's Q differs from one. See Waldenström (2015b, section C3) for a calculation of Tobin's Q for Sweden since 1980.

6 National income equals the gross domestic product minus net foreign factor income (i.e. incomes to and from foreigners in and outside of Sweden) and capital depreciation. Data come from Edvinsson (2005, 2014).

7 Quantifying the spread and size of these informal claims is, of course, difficult since they do not appear in the official statistical sources or banking statistics. However, they do show up in people's probate records that are compiled at the time of death, and this source of the sum of informal credits has formed the basis for their estimation (see further Waldenström, 2015b). The structure informal and formal credit markets in nineteenth-century Sweden has been studied by, for example, Lindgren (2002), Lilja (2004) and Perlinge (2005).

8 Indeed, Feldstein (1974), Berg (1983) and Gale (1998) present evidence on a negative relationship between public pension assets and private financial wealth.

9 Waldenström (2015a) analyses the historical evolution of these pension assets back to the nineteenth century.

10 See further Waldenström (2015b, section B3).

11 The formalisation of the modern municipalities and counties was done in the early 1860s.

12 Schön (1989) estimates a series of Swedish net capital imports from the 1820s, using a method based on comparing the net export and changes in the foreign exchange reserves at the Swedish Riksbank. Schön adds the costs of the imported capital, using the interest on government bonds as a proxy for the cost of capital. The foreign debt stock is the equal to the accumulated capital imports. See further Waldenström (2015b, section C7).

13 See Waldenström (2015b, Section B3) for a closer comparison.

14 To see this, note that national wealth is composed by domestic capital and net foreign assets and that domestic capital is composed by private (i.e. household + corporate) and government capital.

15 Statistics Sweden (1995, table 3:7) lists the stock of produce and non-produced non-financial assets of both non-financial and financial corporations for the end of years during the period 1980–1994 (or actually 1 January in 1981–1995). Since 1995, Statistics Sweden reports the produced stocks in the quarterly and annual national accounts. I estimate the stock of non-produced non-financial assets (i.e. land and timber tracts) assuming the average relation as in 1980–1994.

16 Total corporate equity includes the total value of market capitalisation of the Stockholm Stock Exchange and not only the share of listed stocks held by households, the reason being that it is not possible to single out household-owned corporate assets from the national accounts.

17 That wars matter for taxation of the rich has also been found by Scheve and Stasavage (2016), who have linked the degree of tax progressivity and the level of inheritance taxation to mass mobilisation of countries actively participating in wars. Their suggested mechanism is that the increased taxation was the ‘price’ that the wealthy had to pay for having the rest of the population putting their lives at stake in the actual fighting.

18 For overviews and further discussion of these questions, see Roine and Waldenström (2015) and Piketty and Zucman (2015).

Additional information

Funding

I have received financial support from the Swedish Research Council, Jan Wallander and Tom Hedelius Foundation, and Riksbankens Jubileumsfond.