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Outline
Global distribution of asset ownership
Impact of changing returns to capital and labour
Ways of thinking about assets and policy opportunities
Links between asset formation and participation
Opportunities for public service reform
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Figure 6 Growth rates 1979-1998
0.0
0.5
1.0
1.5
2.0
2.5
Australia UK US NL France Canada NZ CH
An
nu
al
avera
ge g
row
th r
ate
Maddison GDP per capita at PPS
Personal income at constant prices
** denotes per tax unit
**
*
*
Source: Tony Atkinson
Asset ownership shapes the distribution of growth
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Source: Tony Atkinson
Figure 5 Median as % mean in US
50
55
60
65
70
75
80
85
90
95
100
1960 1965 1970 1975 1980 1985 1990 1995 2000 2005
Me
dia
n t
ax
un
it in
co
me
as
% m
ea
n t
ax
un
it in
co
me
Current Population Survey Household Gross Income
Income tax data Tax Unit Gross Income
US Median income grew at 0.5-0.7% per year less than mean income
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Inequality growth is compound: left alone, rich get richer
Globalisation of equity, product, job markets broadens spread of outcomes, raises entry barriers and therefore deepens marginalisation: access to savings vehicles, housing ownership, personal and business credit all relevant.
Material and financial assets intertwine with intellectual and social capital; in particular, as returns to skill increase, investment in human capital increases as a long term influence on life chances
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The role of assets
Spreading financial assets
Integrated lifetime accounts
Individual Development AccountsChild Trust FundPension reformSkills and education accounts
New credit and property instruments
Microcredit, Grameen Bank De Soto property rights
Shared equity and self build housing schemes
Public finance and institutions
Australia: Future FundChile: Economic and Social Stablisation Fund
Norway, Canada, long term funds from oil revenues
Participative public services
Institutions which encourage long term asset formation by sharing responsibility and investment:
Health, work, learning, saving
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Successful system design depends on overlapping fields of participation (and the quality of their institutions)
Economic
SocialDemocratic
Role of intermediary institutions in shaping choices, enabling asset formation, mobilising participation, is crucial
State’s role is increasingly to shape the environments in which market choices are taken and capabilities formed
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Link to public services: a source of institutional innovation
Community asset ownership: buildings, public spaces, organisations
Personalisation of services Direct participation and dialogue across communities
Social partnership for income distribution and ‘good work’ agenda
Shared investment vehicles for asset accumulation
Deliberative participation in everyday settings
Public service framework focused on human capital formation as well as security