Income and Wealth Inequality in Malta

Abstract

This paper studies for the first time the distribution of income and wealth in Malta based on three waves of micro-level data from the Household Finance and Consumption Survey (HFCS). The focus of the analysis is to examine various socioeconomic aspects of income and wealth inequality and contributing factors, as well as determinants of the joint distribution of income and wealth. Results suggest that household main residence (HMR) is the most equalising factor of wealth inequality, while self-employment wealth is the most disequalising factor. The financing structure of HMR is particularly important to explain the position of a household in the wealth distribution. Furthermore, the age and education level of the reference person of a household, increases in household income and inheritance or gifts affect positively the probability of a household to be in a higher net wealth quintile.