Hostname: page-component-76fb5796d-skm99 Total loading time: 0 Render date: 2024-04-27T02:28:15.662Z Has data issue: false hasContentIssue false
  • English
  • Français

The Life Cycle in Economic History

Published online by Cambridge University Press:  03 March 2009

J. R. Kearl  and
Clayne L. Pope
J. R. Kearl
Affiliation:
Associate Professors of Economics, Brigham Young University, Provo, Utah 84602
Clayne L. Pope
Affiliation:
Associate Professors of Economics, Brigham Young University, Provo, Utah 84602
Get access Rights & Permissions [Opens in a new window]

Abstract

The life cycles of income and wealth form important traces of the economic history of households. Comparisons of cross-sectional estimates of the age-wealth profiles from 1774 to 1962 reveal little change in the basic pattern although crosssectional age-income or earnings profiles peak later in modern periods because of the increased investment in human capital.The wealth-income ratio appears to be declining. Multivariate regressions for Utah households show wealth-income patterns consistent with a life cycle model based on smoothing of consumption with little interaction between age and other determinants of economic position. Foreign birth has a positive effect on income while reducing wealth.

Type
Papers Presented at the Forty-Second Annual Meeting of the Economic History Association
Information
The Journal of Economic History , Volume 43 , Issue 1 , March 1983 , pp. 149 - 158
Copyright
Copyright © The Economic History Association 1983

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

1 see Mortan paglin,“The Measurement and Trend of Inequality:A basic Revision,“American Economic Review,65 (9, 1975), 598–609Google Scholar

2 Fogel, Robert and Engerman, Stanley, Time on the Cross (Boston, 1974);Google ScholarGoldin, Claudia, “The Historical Evolution of Female Earnings Functions and Occupations,” NBER Working Paper No. 52 (1980);Google ScholarGoldin, , “Women in the American Labor Experience: Issues, Life Cycle Participation and Earnings Function Cliometrics Conference (1979)”; Michael Haines, Fertility and Occupation (New York, 1979);Google ScholarJones, Alice H., Wealth of a Nation to Be (New York, 1980);Google ScholarSoltow, Lee, Men and Wealth in the United States, 1850–1870 (New Haven, 1975).Google Scholar

3 For contemporary examples see Chez, Gilbert and Becker, Gary, The Allocation of Time and Goods over the Life Cycle (New York, 1975);Google ScholarModigliani, Franco and Ando, Albert, “Tests of the Life Cycle Hypothesis of Savings,” Bulletin of the Oxford Institute of Economics and Statistics 19 (05 1957), 99–124;Google ScholarShorrocks, A. F., “The Age-Wealth Relationship: A Cross-Section and Cohort Analysis,” Review of Economics and Statistics, 57 (05 1975), 155–63;CrossRefGoogle ScholarBen-Porath, Yoram, “The Production of Human Capital and the Life Cycle of Earnings,” Journal of Political Economy, 75 (06/08 1967), 352–65.CrossRefGoogle Scholar

4 See Jones, Wealth of a Nation To Be; Soltow, Men and Wealth;Google Scholar

Projector, Dorothy S. and Weiss, Gertrude S., Survey of Financial Characteristics of Consumers (Washington, D.C., 1966).Google Scholar

5 The increase of wealth beyond age 65 in 1870 is curious and of interest. Atack and Bateman find a peak in the life cycle of wealth in 1860. See “The ‘Egalitarian Ideal’ and the Distribution of Wealth in the Northern Agricultural Community: A Backward Look,” Review of Economics and Statistics, 58 (Feb. 1981), 124–9. We also find a peak in 1860 and one in the life cycle for 1870 as well. Soltow's sample obviously has the broadest coverage.Google Scholar

6 See Mirer, T. W., “The Wealth-Age Relationship Among the Aged,” American Economic Review, 69 (06 1979), 435–43,Google Scholar and Smith, James, ed., The Personal Distribution of Income and Wealth (New York, 1975).Google Scholar

7 King, M. A. and Dicks-Mireaux, Louis, “Asset Holdings and the Life Cycle,” NBER Working Paper No. 614 (Jan. 1981).CrossRefGoogle Scholar

8 See Fogel and Engerman, Time on the Cross, p. 76.Google Scholar

9 See Haines, Fertility and Occupations, p. 42.Google Scholar

10 Mincer, Jacob, Schooling, Experience and Earnings (New York, 1974).Google Scholar

11 See Jones, Wealth of a Nation To Be, chap. 9, and Soltow, Men and Wealth, chap. 3, for a discussion of the growth rate of wealth as compared to the growth of income.Google Scholar

12 Compare Soltow, Men and Wealth, p. 80,Google Scholar to Kearl, J. R., Pope, Clayne L., and Wimmer, Larry T., “Household Wealth in Utah: 1850–1870,” this Journal, 40 (09 1980), 489.Google Scholar

13 Kearl, J. R. and Pope, Clayne L., “Intergenerational Effects on the Distribution of Income and Wealth: The Utah Experience,” NBER working Paper No. 754 (Sep. 1981).Google Scholar