What explains the gender gap in wealth? Evidence from administrative data

This paper studies the gender gap in net wealth. We use administrative data on wealth that are linked to the Estonian Household Finance and Consumption Survey, which provides individual-level wealth data for all household types. The unconditional gender gap in mean wealth is 45%, but this sizeable gap in means originates mainly from the top tail of the distribution, where men have much more wealth than women, while the gender differences in wealth are statistically insignificant in most of the lower wealth quintiles. At the top of the distribution the differences in wealth can be explained by larger self-employment activity of men. Men have more business wealth than women do, and the gender wealth gap is the largest for this asset class. The gender wealth gaps across different household types are very heterogeneous. The unconditional gaps in wealth are strongly in favour of men throughout most of the wealth distribution for married couples. For single-member households, on the other hand, the raw gaps are in favour of women in the lower half of the wealth distribution. These raw gaps in opposite directions can mostly be explained by differences in the observed characteristics of men and women among married couples vs single people.