@article{AFlexible:661,
      recid = {661},
      author = {Macklem, Tiff},
      title = {A Flexible, Forward-Looking Measure of Wealth},
      publisher = {Bank of Canada},
      address = {1991},
      pages = {1 online resource (44 pages)},
      abstract = {This paper develops a measure of private-sector wealth  which includes financial, physical and human wealth. In an  attempt to capture important observed differences between  individuals, consumers are modelled as being of two types —  liquid and illiquid. Liquid consumers can borrow against  expected future earnings, while illiquid consumers cannot.  This approach has the attractive feature that the resulting  measure of aggregate wealth is flexible enough to encompass  a range of views on the importance of the forward-looking  component of wealth and the validity of the Ricardian  equivalence proposition. Human wealth, or more  specifically, the expected discounted value of future  earnings net of government expenditures, is evaluated using  a time-series approach. A numerical solution for this  expectation is obtained by approximating a real-valued  vector process as a discrete-valued Markov chain. To the  extent possible, non-human wealth is measured at market  value. The paper concludes by comparing alternative  historical series for wealth which embody different  assumptions regarding Ricardian equivalence.},
      url = {http://www.oar-rao.bank-banque-canada.ca/record/661},
      doi = {https://doi.org/10.34989/swp-1991-5},
}