luis de guindos : gabriel zucman ’ s contribution to research on wealth inequality and the redistributive effects on globalization remarks by luis de guindos, vice - president of the european central bank, on the occasion of the award of the bernacer prize to professor gabriel zucman, madrid, 11 october 2019. * * * it is a pleasure for me to celebrate with you the award of the 2019 bernacer prize to gabriel zucman, assistant professor of economics at the university of california, berkeley. gabriel ’ s creative work on measuring household wealth over time and across countries and his studies on the effects of taxation and globalisation on the accumulation of wealth have become increasingly influential among academic economists and policymakers. he is a deserved recipient of the bernacer prize, which is awarded each year to an outstanding young european economist working in the fields of macroeconomics and finance. this year ’ s prize has been awarded specifically for gabriel ’ s “ influential research on wealth inequality and the redistributive effects of globalisation ”. gabriel, together with his co - authors thomas piketty and emmanuel saez, has been one of the pioneers in this field, showing us how to use various data sources – aggregate sectoral accounts, household surveys, fiscal data, historical administrative data and unofficial records – to estimate the evolution and determinants of the wealth distribution over centuries. such a long time range is important, as many of the movements in wealth inequality are very gradual, which means that these changes can only be estimated reliably once enough data are available. at the same time, retrieving historical information on wealth poses multiple challenges. first, data on household wealth are much scarcer than, say, data on household income. second, the wealth distribution is heavily skewed toward its top tail, such that relatively few households hold a large fraction of aggregate wealth in the economy. consequently, to be able to measure wealth inequality, it is important that we include information about the very richest households. third, and especially for the richest households, one should account for all assets, including those held abroad, which tend to be more difficult to trace. a key approach used by gabriel to overcome these challenges is the “ income capitalisation method ”, which uses fiscal data on capital income to estimate the wealth distribution. although not always easily accessible, fiscal data are available for several decades and also cover the richest households. the method is therefore useful in

significant member of the group, ( but which may include other types of regulated financial activities ). the need for this guidance from basel assumes even greater significance within the context of recommendations being made under fsap reviews, for the prompt and full implementation of consolidated and conglomerate supervision. we therefore, would wish to use this forum to urge the international standard setters and assessors to immediately take on board the need to provide detailed and specific guidance with regards to the conglomerate supervision of such group structures, within the context of the core principles. in fact, it is our hope that, in the interim, this seminar will serve to clarify several of the practical issues with which we are grappling and provide us with clear pointers as to the way forward. in a sense we have had to break new ground on this issue, developing methodology that is underpinned by the fundamental prudential principles, but which seek to address our unique situation. i would wish to share with you this morning some of the specific initiatives in which the bank of jamaica ( boj ) has been involved in recent years towards the ultimate aim of a having a comprehensive framework in place for consolidated supervision. these have included : • establishment of a financial regulatory council ( frc ) in 1999, chaired by the bank of jamaica and with representation from the financial services commission – the supervisory authority with oversight responsibility for the non - deposit taking financial sector in jamaica ( i. e. securities dealers, insurance companies, pension funds, unit trusts and mutual funds ). this council was determined necessary to ensure that the necessary legal channels exist for critical communication, collaboration and information sharing especially as regards dually licensed institutions, but more generally, to ensure a coordinated policy approach to regulation of the entire financial system and so also reduce the potential for regulatory arbitrage. to ensure full coverage of all critical issues impacting the system, the council ’ s membership also includes representation from the jamaica deposit insurance corporation ( jdic ), the ministry of finance and the solicitor general. • the boj also proposed legislative amendments which were passed in 2002 which have enhanced our powers to more effectively carry out consolidated supervision of any corporate group which includes a deposit - taking licensee. these amendments allow for supervisory reach to holding companies, thus enabling such entities to be monitored on a similar basis as its subsidiary banking entity, specifically as it relates to the management of risks and assessment of capital adequacy requirements across the entire group. • these statutory amendments also prohibit the existence of