Unlocking the nexus of wealth, entrepreneurship and inequality.
The Stone Centre at LSE brings together world-leading economists to provide new scientific evidence on how entrepreneurship shapes wealth concentration — and what governments can do about it.
Top wealth holders in the US and Europe directly own more than half of all privately held companies, and the top 1% control business assets accounting for over 15% of national employment and value-added in most European countries. Yet we know remarkably little about how entrepreneurial those assets really are, how they should be valued, or how they respond to policy. Based in the Department of Economics at the London School of Economics and Political Science, the Centre brings together leading economists across macroeconomics, public finance, corporate finance and the economics of innovation to address four questions:
01 — Entrepreneurship and the dynamics of wealth inequality. How much of top wealth is entrepreneurial, and how does this evolve across generations through creative destruction and inheritance?
02 — Business asset valuation and wealth inequality. What drives the large swings in private business asset values, and what does this mean for how we measure and tax wealth?
03 — Effects of policy on entrepreneurship and dynamism. How do wealth taxes, capital gains taxes and inheritance rules affect investment, innovation and location decisions?
04 — Designing fairer and more efficient policies. How should tax systems be structured to encourage entrepreneurship while ensuring equitable outcomes for all?
Camille Landais, Katrine Jakobsen, Henrik Kleven, Jonas Kolsrud & Mathilde Munoz
Using rich administrative data from Sweden and Denmark — exploiting three major wealth tax reforms — this paper estimates international migration responses to wealth taxation and their aggregate economic consequences.
A one percentage point increase in the top wealth tax rate reduces aggregate employment by just 0.02%, investment by 0.07%, and value-added by 0.10%. The migration threat dominating public debate is far less consequential than intensive margin responses.
Through INTER — the International Network for Taxation and Entrepreneurship Research — the Centre maintains local antennae at the University of Zurich, Barcelona School of Economics, and Bocconi University, and builds connections across the US (Yale, Princeton, Harvard, Berkeley) and Asia (Academia Sinica, Taiwan).
People
Leadership Team
The Stone Centre's leadership team, based at the LSE Department of Economics.
Co-Director Professor of Economics Former Director, STICERD
2016 Prize for Best Young French Economist
Philip Leverhulme Prize in Economics
Camille Landais is Professor of Economics at LSE, former Director of STICERD and a former Chairman of the French Council of Economic Advisers. His research examines capital and wealth taxation, inequality and the economics of the family. As Co-Director, he brings together the Centre's research on taxation, distribution and policy design.
His research uses large administrative datasets to study the design and effects of public policy. His work on wealth taxation and migration, based on administrative data from Sweden and Denmark, provides evidence on how high-wealth taxpayers respond to wealth taxes.
He is co-author, with Thomas Piketty and Emmanuel Saez, of Pour une révolution fiscale. His experience leading STICERD and advising on economic policy supports the Centre's aim of connecting rigorous academic research with public debate. He holds a PhD from the Paris School of Economics.
Kate Smith
Co-Director Assistant Professor of Economics Research Fellow, IFS
Kate Smith is Assistant Professor of Economics at LSE, as well as a Research Fellow at the Institute for Fiscal Studies. She specialises in public finance, industrial organisation and the design of tax and transfer systems. Her research on businesses, consumers and household responses contributes detailed empirical evidence to the Centre's work on the distribution of income and wealth.
Her research combines econometric modelling with large administrative datasets to examine how policy affects businesses and their owners, how governments should tax goods that create externalities, and how households can be supported through economic shocks.
Before joining LSE, she worked at the Institute for Fiscal Studies from 2011 to 2022 and served as an Associate Director from 2020 to 2022. She remains an IFS Research Fellow and is a CEPR Research Affiliate, maintaining strong links between the Centre, academic research and policy analysis. She holds a PhD in Economics from UCL.
Investigators
Ben Moll
Investigator Sir John Hicks Professor of Economics
Calvó-Armengol International Prize (2023)
Bernácer Prize — Best European Economist Under 40 (2018)
Ben Moll is Sir John Hicks Professor of Economics at LSE. His research examines the interaction between inequality, macroeconomic outcomes and economic policy. His work gives the Centre a framework for connecting individual and firm-level differences to economy-wide changes in income and wealth.
His research develops quantitative models that incorporate heterogeneity across households and firms. His continuous-time approach to heterogeneous-agent models, published in the Review of Economic Studies in 2022, provides widely used methods for analysing income and wealth distributions in macroeconomics.
Through this combination of economic theory, computational methods and policy analysis, he contributes to the Centre's study of how shocks and reforms affect different groups across the distribution. He holds a PhD from the University of Chicago.
Xavier Jaravel
Investigator Professor of Economics Chairman, French CAE
Philip Leverhulme Prize in Economics (2019)
Prize for Best Young French Economist (2021)
Xavier Jaravel is Professor of Economics at LSE, as well as Chairman of the French Council of Economic Advisers. His research focuses on inclusive growth, innovation, international trade and inequality, extending the Centre's analysis beyond incomes to the unequal distribution of gains from new products and technologies.
His work examines how innovation, prices and consumer markets shape the distribution of economic gains. It brings consumer choice, technological change and access to innovation into the Centre's wider research on inequality and economic opportunity.
His inaugural LSE lecture in February 2025, The Lost Marie Curies, presented his research on broadening participation in innovation. With Friedrich Geiecke, he has also developed methods for AI-led qualitative interviewing, using large language models to run open-ended interviews with thousands of respondents at once — an approach now informing the Centre's own survey and interview-based research. He holds a PhD from Harvard University.
Johannes Spinnewijn
Investigator Professor of Economics Director, CEPR Public Economics
Wiley Prize, British Academy
Johannes Spinnewijn is Professor of Economics at LSE, as well as Director of CEPR's Public Economics Programme. His research places particular emphasis on social insurance, inequality and the design of tax and benefit systems.
His work studies how differences in risk, information, beliefs and behaviour affect insurance markets and the design of public policy. This expertise broadens the Centre's analysis of inequality by connecting the distribution of resources to the institutions through which households manage unemployment, health and retirement risks.
His research with Camille Landais develops welfare-based approaches to the evaluation of pension and social-insurance reforms, with applications to policy analysis in France and other countries. As Director of CEPR's Public Economics Programme, he also connects the Centre to a wider international network of public-finance researchers. He holds a PhD from MIT.
Maarten de Ridder
Investigator Assistant Professor of Economics
UniCredit Foundation Prize — Best Doctoral Dissertation (2020)
Maarten de Ridder is Assistant Professor of Economics at LSE, specialising in productivity, firm dynamics and technology adoption. His research brings the role of firms, intangible capital and market structure into the Centre's study of inequality and wealth concentration.
His work examines how investment in intangible assets affects competition, business dynamism and the distribution of economic activity across firms. His 2024 article in the American Economic Review develops a unified account of slower productivity growth, declining business dynamism and rising market power, and quantifies the contribution of intangible investment to these trends.
This firm-level perspective complements the Centre's research on household wealth and taxation by examining how changes in production and market power shape the returns to ownership. He holds a PhD from the University of Cambridge.
Centre Management
DB
Devynn Barnes
Centre Manager
Devynn Barnes is Centre Manager, with a background in global education partnerships, programme delivery and public policy. Her experience working with international organisations, governments and civil society supports the Centre's research activities and external engagement.
Before joining the Centre, she worked across a range of international settings, most recently with UNICEF and the International Rescue Committee. In these roles, she supported ministries and civil society organisations in designing and implementing inclusive, evidence-informed education programmes.
She holds a Master of Public Administration from New York University, where she specialised in international development and education policy. Her interests include translating research into practical tools for teachers and improving the capacity of education systems to serve marginalised learners.
Affiliated Faculty
To be confirmed
Affiliated Faculty profiles will be listed here following the Centre's formal launch in September 2026. The Stone Centre at LSE draws on a broad network of faculty across the LSE Department of Economics, the Department of Finance, the International Inequality Institute, and CENTAX.
Fellows
PhD & Post-Doctoral
Stone Centre Fellows will be listed here following the Centre's formal launch in September 2026. The Centre will award Stone PhD Fellowships and host Post-Doctoral Fellowships for early-career researchers working on wealth inequality and entrepreneurship. See PhD Fellowships and Post-Doctoral Fellowships for details on how to apply.
Research programme
Papers & Publications
The Stone Centre's research programme addresses a set of interrelated questions about the relationship between wealth, entrepreneurship, and policy, spanning empirical microeconomics, macroeconomics, public finance, and the economics of innovation. Papers are listed newest first and tagged by subfield; many span more than one.
Using administrative data from Scandinavian countries, the authors find significant international migration responses to wealth taxes among the wealthy: a 1pp increase in the top wealth tax rate decreases the stock of wealthy taxpayers by about 2%. A large share of the wealthy are business owners, and their businesses are hurt by the owner's departure. Yet the aggregate effects are modest — the same 1pp increase reduces employment by 0.02%, investment by 0.07% and value-added by 0.10%.
Source: the aggregate-effects results in Section 6.1.2 and Figure 12 of the paper.
Standard optimal capital tax theory abstracts from asset prices, making it unsuited to capital gains and wealth taxation. Modelling price changes as driven by both cash flows and discount rates, a combination of realisation-based capital gains and cash-flow taxes implements the optimal allocation regardless of the source of price fluctuations — and, by targeting net trades rather than gains on individual assets, avoids distorting portfolio choice (the “lock-in effect”). This stands in contrast to the classic Haig–Simons comprehensive-income concept and to recent proposals for wealth or accrual-based capital-gains taxes.
A dynamic model of business owner-manager choices studies the equity and efficiency effects of capital tax reforms, allowing for both real investment responses and income-shifting between types of capital return. Raising all capital tax rates by the same amount raises revenue progressively, but at an efficiency cost. Two further reforms do better: reducing the differentials between tax rates on different types of capital return lowers income-shifting and its distortions to the timing of investment, while reforming the tax base lets the policymaker raise revenue from inframarginal investment without discouraging marginal investment — equity and efficiency gains that rate changes alone cannot deliver.
A novel dataset of US wealth, built from historical property tax records at the state, county and national level from 1850 (or earlier) to 1935. The United States experienced extraordinary wealth accumulation after the Civil War, continuing until the Great Depression. Spatial inequality in wealth across counties has been large and highly persistent since the mid-1800s. Counties with a higher share of enslaved property before the Civil War, or with higher wealth inequality, saw lower long-run wealth growth afterward — a link partly mediated by slower gains in literacy.
Argues that the standard assumption of rational expectations about equilibrium prices is unrealistic in heterogeneous-agent macroeconomics, since it requires agents to forecast entire cross-sectional distributions — an extreme curse of dimensionality (the “Master equation,” half-jokingly the “Monster equation”) that no real-world agent plausibly solves. Sets out three criteria for alternatives — computational tractability, consistency with the evidence, and (some) immunity to the Lucas critique — and surveys promising directions: temporary equilibrium approaches, survey expectations, least-squares learning, reinforcement learning, and simpler forecasting heuristics.
Using French manufacturing product-level data, product innovation frequently arrives in “bursts” — episodes in which firms rapidly add multiple products to their portfolio: 5% of firms are responsible for over 76% of product creation. Bursts lead to substantial shifts in revenue, and the process of product creation and destruction explains 88% of the variance in five-year firm growth. The authors' model nests the canonical Klette–Kortum model of creative destruction as a special case, while explaining the concentration of production among superstar firms.
Source: Figure 2a and Appendix Table C3 in the paper.
Corporate Finance & Firm Dynamics · Economics of Innovation
Advanced economies are reshaped by transitions from old to new technological paradigms, which rely on complementary innovations spreading the new technology across industries. Using a Schumpeterian growth model with financial frictions, investment in new technologies is more sensitive to tight credit than investment in mature ones. The key mechanism is path dependence: firms build expertise in the technologies they've previously developed, so young firms self-select into emerging technologies — and since young firms are more financially constrained, credit shocks disproportionately depress innovation in new technologies. The mechanism is validated with causal evidence on green patenting by German firms around the Global Financial Crisis: the resulting slowdown in young firms sorting into new technologies accounts for about half of the macro slowdown in green patenting.
Firm-level markup estimates are central to macroeconomic analysis of market power, but methods to obtain them require price data, and wide-coverage firm data comes primarily from financial statements that lack it. Using an analytical framework, the authors show trends over time and dispersion across firms can still be well measured from financial data alone — though measuring the average level of the markup does require pricing data, for which they propose a consistent estimator. Validated against a quantitative macro model and firm-level administrative pricing data.
Using novel linked datasets from the US and Finland, innovators create products more likely to be purchased by consumers like them in gender, socioeconomic status and age — a homophily pattern stable across product categories, industries and recent decades. Built into a growth model, this “social push” channel implies unequal access to innovation careers has large effects on cost-of-living inequality and long-run growth: eliminating access barriers for female innovators would cut the cost-of-living gender gap from 18.7% to 0.5% and raise long-run productivity growth from 2% to 3.44% annually, while homophily by socioeconomic status explains 62% of cost-of-living inequality between top and bottom income quintiles.
Source: the baseline full-exposure counterfactual in Table 9, Panel A of the paper.
Large language models can now run open-ended qualitative interviews — including voice-based ones — with thousands of respondents at once, at a fraction of the cost of human interviewers. Tested across four domains (decision-making, political attitudes, subjective wellbeing and policy understanding) and validated against human experts and quality benchmarks, AI-led interviews are rated on par with an average human interviewer and generate 142% more text than a conventional open-text field. The approach offers a low-cost channel for measurement, hypothesis generation and mechanism discovery at a scale conventional interviewing cannot match.
Word count generated on the same open-ended question. Source: Geiecke & Jaravel (2024), meaning-in-life study.
Corporate Finance & Firm Dynamics · Economics of Innovation
Using a shift-share IV design exploiting pre-determined supply linkages and productivity shocks, this paper estimates the labor- and product-market effects of a fall in the cost of investments in modern manufacturing capital, including automation. At both the firm and industry level, capital investments raise labor demand, sales and exports, and lower the labor share, while wage inequality is unchanged. The industry-level labor-demand response is positive only in industries exposed to import competition — reflecting business-stealing across countries. The findings point to a task-based framework in which the productivity effect dominates the displacement effect.
Rising asset valuations across many asset classes over recent decades have shaped the distribution of wealth, but their welfare-redistributive effects were poorly understood. The authors derive a sufficient statistic for the money-metric welfare gain from asset-valuation changes, showing it depends on the present value of an individual's net asset sales rather than their holdings: higher valuations benefit prospective sellers and harm prospective buyers. Using panel microdata covering the universe of financial transactions in Norway (1994–2019), they find the rise in asset valuations had large redistributive effects — from the young to the old, and from the poor to the wealthy. Winner of the WFA NASDAQ Award for the Best Paper on Asset Pricing (2024).
Using Norwegian administrative panel data, saving rates net of capital gains are approximately flat across the wealth distribution — around 6–8% from the 25th percentile up — so the rich do not save a larger share of income than the poor. Saving rates including capital gains, however, rise sharply with wealth, reaching about 50% for the top 1%, because wealthier households hold more appreciating assets and tend not to liquidate them — “saving by holding.” A calibrated housing model, with standard isoelastic preferences, replicates both patterns without requiring a luxury bequest motive.
Aggregate price shocks can generate significant inequality in losses, both across and within income groups, creating a trade-off between subsidies — which target those most affected but introduce inefficiencies — and transfers, which are less distortionary but harder to target precisely. Using rich panel data on energy spending and income alongside price and policy variation from the 2022–23 European Energy Crisis, the authors show unmitigated household welfare losses would have averaged 6% of income, with some households facing much larger losses. The energy price subsidy and universal transfers actually implemented reduced both the mean and dispersion of losses but incurred efficiency costs equal to 12% of total funds spent. Under a range of social preferences, better-targeted transfers would have lowered the optimal subsidy rate, though not eliminated it.
The share of pre-tax income flowing to the top of the UK distribution rose continually and substantially in the three decades before the financial crisis, but has changed little since 2013. Wages remain the dominant source of pre-tax income even for the highest-income 0.1%, while active business income is much more important at the top than lower down the distribution. UK income taxes are progressive and higher taxes since 2010 have reduced post-tax top income shares. Yet average tax rates vary substantially within the top because business and investment incomes are taxed less heavily than employment income, strengthening the case for reforming the tax base and aligning rates across income forms.
Paper Figure 3. Active business income includes self-employment, partnerships and dividends paid to company owner-managers. Source: Survey of Personal Incomes 2018–19.
Paper Section 6 and Figure 10. Shares are for 2018–19 after income tax, NICs excluding employer contributions, and imputed corporation tax on owner-manager dividends.
Corporate Finance & Firm Dynamics · Economics of Innovation
This paper offers a unified explanation for the slowdown of productivity growth, the decline in business dynamism and the rise of market power. Intangible inputs such as software reduce marginal costs but raise fixed costs, giving firms that deploy them efficiently a competitive advantage and allowing them to undercut potential innovators. A broad-based rise in intangibles can stimulate innovation and growth; an unequal rise concentrates R&D among high-intangible incumbents, deters entry and reduces the effectiveness of innovation. Structurally estimated using French and US microdata, the model produces an initial productivity boom followed by lower long-run growth, declining entry and higher aggregate markups — matching the empirical patterns observed since the mid-1990s.
Paper Introduction and Figure 3: fixed costs as a share of total costs, US 1979–2015 and France 1994–2016.
All values are reported percentage-point changes. Source: the Introduction, the steady-state comparisons, and Appendix Table A19 in the paper.
Using Swedish administrative data, the paper evaluates the distributional effects of pension reforms through consumption. On average, workers who retire earlier consume less while retired and experience larger drops in consumption around retirement, implying that reforms which incentivise later retirement impose a substantial consumption-smoothing cost. Reforms that redistribute according to early-career labour supply would have opposite-signed redistributive effects, while differentiation by wealth may help target pension benefits towards people vulnerable to larger consumption drops.
Those retiring after age 65 have about 20% higher consumption in retirement than those retiring before age 60. Source: Section 4.1 and the consumption-level figure in the paper.
Consumption falls nearly 10% for those retiring before age 60 and shows virtually no decline for those retiring after age 65. Source: Section 4.1 and the consumption-dynamics figure in the paper.
The bottom wealth quartile's consumption drops about 12%; its larger drop explains about 30% of the overall consumption gradient by wealth. Source: Figure 9, Panel C in the paper.
As labour income loses its capacity to drive mobility across Western wealth distributions, inheritance is again becoming a principal determinant of who reaches the top. Yet inheritance-tax systems remain unpopular and have failed to be genuinely progressive. Using French administrative and survey data, the paper proposes reforms that make inheritance taxation more efficient, progressive and transparent, including a lifetime inheritance base and a universal wealth endowment funded by the additional revenue. Its simulations show, however, that inheritance taxation alone cannot counter current wealth concentration at the top and must be complemented by progressive taxation of wealth and/or capital income.
In France, the lifetime-inheritance ratio between the median heir and the top 0.1% is about 1:180; the corresponding labour-income ratio is about 1:10. Source: Section 2 of the paper.
The top 0.1% inherit around €13 million net of tax, yet pay an effective rate just under 10%, compared with the 45% top marginal rate on transmissions above €1.8 million. Source: Figure 5 in the paper.
Even with effective average rates above 40% for the top 0.1%, the top-to-median net-inheritance ratio remains above 40. A universal endowment financed by the reform would hardly exceed €10,000. Source: Figure 6 and the accompanying reform discussion in the paper.
New technologies benefit not only high-skilled workers but also capital owners through higher capital incomes, increasing inequality. The paper develops a tractable theory linking technology to the distributions of income and wealth, not only wages, and identifies a mechanism through which automation raises inequality by increasing returns to wealth. The corresponding shift of productivity gains towards capital can produce stagnant wages and incomes at the bottom. A multi-asset extension reconciles differing trends in returns to productive and safe assets, showing that the relevant return measures have risen over time and that automation can account for part of the observed growth in income and wealth inequality.
Predicted steady-state wage changes: real wages fall 10% at the 25th percentile and rise 7% at the 95th percentile. Wages decline below the 80th percentile. Source: the quantitative steady-state results in Section 5 of the paper.
Below the median, total income declines 5-10%; it stagnates between the 50th and 80th percentiles, while rising 20% for the top 1%-0.5% and 55% for the top 0.1%. Source: the income-distribution results in Section 5 of the paper.
The calibrated automation shock raises the inverse Pareto index of income from 0.54 to 0.65 - about 75% of the increase estimated by Piketty, Saez and Zucman. Source: the top-income-inequality results in Section 5 of the paper.
The paper recasts the Aiyagari-Bewley-Huggett model of income and wealth distribution in continuous time, reducing heterogeneous-agent models to systems of partial differential equations. It establishes an analytical characterization of poor households' consumption and saving, including their marginal propensities to consume; derives a closed-form wealth distribution for a special case with two income types; and proves uniqueness of the stationary equilibrium when the intertemporal elasticity of substitution is at least one. It also develops a simple, efficient and portable finite-difference algorithm for stationary equilibria and transition dynamics across a broad class of heterogeneous-agent models.
Source: Sections 2–4 and the propositions developed in the paper.
For a given accuracy, the continuous-time method is at least twice and more than 30 times faster for policy functions, and 10-500 times faster for aggregate consumption. Source: the numerical-method comparison in Section 5 and its computational appendix.
Matlab benchmarks using 1,000 wealth-grid points on the MacBook Pro described in the paper; the transition uses 400 time steps. Source: the runtime benchmarks in the computational appendix.
The article reviews advances in the study of inflation inequality. New price-index theory makes it possible to measure inflation across household groups, while granular US data show that inflation declines with household income and that aggregation can conceal substantial differences. Evidence indicates that the direction of innovation is an important driver of US inflation inequality, whereas trade has had similar price effects across the income distribution. These differences reshape cost-benefit analysis, optimal taxation and stabilisation policy, and affect interpretations of structural change, declining labour shares and interest rates, and labour-market polarisation.
Average annual US inflation, 2004-2015: 2.20% for the bottom income quintile and 1.86% for the top quintile, a 0.346 percentage-point difference. Source: Figure 1 in the paper.
The measured bottom-to-top inflation difference falls by about 80% when products are aggregated from 256 detailed categories into 22 subcategories. Source: the product-aggregation discussion in Section 2.2 of the paper.
A one-percentage-point increase in demand growth lowers inflation by 0.42 percentage points for continuing products and 0.62 points after accounting for product variety. Source: Section 3.2 of the paper.
Using US retail scanner data from 2004 to 2015, the paper finds that annual inflation was 0.661 percentage points higher for the bottom income quintile than for the top; including changes in product variety raises the difference to 0.8846 points, while data covering the full consumption basket yield a 0.368-point gap. A shift-share design shows that faster demand growth causes greater product variety and lower inflation for continuing products. Growth and rising inequality therefore direct innovation towards expanding, higher-income market segments, and the calibrated mechanism accounts for more than half of observed inflation inequality.
Annual inflation difference, bottom relative to top income quintile, 2004-2015. Standard errors are shown in the tooltips. Source: the headline estimates in the Introduction and Section III of the paper.
Instrumental-variable estimates for a one-percentage-point increase in demand growth: -0.42 points for continuing products and -0.62 points including product variety. Source: the instrumental-variable estimates in Section IV of the paper.
Changes in markups explain between 50% and 100% of the price response of continuing products. The calibrated innovation channel accounts for more than half of observed inflation inequality. Source: the markup and innovation decomposition in Section V of the paper.
Linking patent records to tax data for 1.2 million US inventors, the paper shows that children's chances of becoming inventors vary sharply with parental income, race and gender, and that these gaps persist among children with similar early maths scores. Childhood exposure to innovation has significant causal effects: children who move earlier to high-innovation areas patent more, and exposure is specific to technology class and gender. Women, minorities and children from low-income families are consequently underrepresented among both inventors and high-impact inventors, implying that many potential “lost Einsteins” never enter innovation.
Children from top-1% families are 10 times as likely to become inventors as children from below-median-income families; white children are more than three times as likely as Black children. Source: Figures I–III in the paper.
About 75% of the correlation between children's patenting and adult patenting in their commuting zone is attributed to causal environmental effects. Moving from the 25th to the 75th percentile area raises the probability of inventing by 37%. Source: Figures VII and IX and the accompanying text in the paper.
Men constitute 82% of today's 40-year-old inventors. At the observed convergence rate, gender parity would take another 118 years. Source: the gender trends in Figure III of the paper.
Using administrative tax and patent data for US patent inventors from 1996 to 2012, the paper identifies team-specific capital from the premature deaths of inventors. Eight years after a co-inventor's death, surviving collaborators' earnings are 4% lower and their citation-weighted patents are 15% lower. Firm disruption, network effects and top-down spillovers do not explain the results: the losses are concentrated in close-knit teams and team-specific capital largely reflects experience that raises the value of collaboration over time.
Effects eight years after a co-inventor's premature death; the research design uses 4,714 deaths occurring at or before age 60. Source: the main causal-effects event-study figures in Section III of the paper.
Standard random-growth theories can explain Pareto tails in long-run income distributions but generate transition dynamics that are too slow to match the rapid rise in US top-income inequality. The paper develops tools for analysing these transitions and proposes two parsimonious departures that can produce fast changes: scale dependence, which may arise from changing skill prices, and type dependence, in which some people are persistent high-growth types. Both are consistent with explanations based on superstar entrepreneurs and managers.
Across the alternative series discussed in the paper, the US top-1% income share rises by at least five percentage points from the 1970s to the paper's observation period. Source: Figure 1 and the Introduction of the paper.
In the paper's calibrated standard random-growth examples, the first moment takes roughly 60 years to converge halfway and transitions deeper in the upper tail approach 100 years. Source: the calibrated transition exercises in Section 3 of the paper.
Source: the type-dependence and scale-dependence mechanisms developed in Sections 4–5 of the paper.
Building on Cohen and Levinthal's concept of absorptive capacity, the article explains how knowledge spillovers can make firms' R&D efforts complementary: firms must conduct research not only to create knowledge but also to assimilate and exploit knowledge produced elsewhere. It traces the implications for cross-country convergence and divergence, international coordination of green-innovation policy, general-equilibrium R&D spillovers, openness in idea production, individual-level knowledge transmission and empirical measurement of R&D spillovers.
Source: the mechanisms and applications reviewed across Sections 2–7 of the paper.
When people differ in both skills and discount factors, the Atkinson-Stiglitz conclusion that savings should not be taxed no longer holds. With heterogeneous saving preferences at each earnings level, a savings tax on high earners or a savings subsidy for low earners raises welfare regardless of the correlation between ability and patience, because people who value future consumption less are more tempted by lower-paid work. A uniform savings tax is welfare-improving when ability and the preference for saving are sufficiently positively correlated.
Source: the welfare results and optimal-tax characterization in Sections 3–4 of the paper.
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Data infrastructure
Datasets & Resources
New longitudinal datasets being built by the Centre team, and existing publicly accessible resources relevant to wealth, entrepreneurship, and taxation.
Longitudinal Administrative Datasets — Individuals to Business Assets
10+ Countries
One of the principal contributions of the Stone Centre is the construction of unique longitudinal administrative datasets linking personal income and wealth tax registries to firm ownership registries. These datasets allow researchers to match firm-level information — including investments, assets, and profits — to owner-level information such as taxable income, wealth, and residence, for both directly and indirectly held firms. Partial links already exist; the Centre will extend these to Brazil, Denmark, France, India, the Netherlands, Norway, Sweden, Taiwan, the UK and the US. The team has extensive experience: Landais in France and Sweden; Smith in the UK and the Netherlands; de Ridder and Moll in Norway.
Long-Run Historical Data on Wealth and Entrepreneurial Activity
200 Years
In the UK, the Centre plans to link probate records (1858–1995) to the Integrated Census Microdata and the British Business Census of Entrepreneurs (1851–1921), combined with full birth, death and marriage registers to study the intergenerational dynamics of wealth accumulation over time. Related endeavours exist for Switzerland (firm creation data from 1883) and the United States (property tax records and firm records from the early 1800s), developed in collaboration with Sacha Dray and Stefanie Stantcheva.
Entrepreneur Survey Platforms
Multi-Country
The Centre will develop survey platforms to better understand the motivations, constraints, and preferences of entrepreneurs. Surveys measure outcomes not recorded in administrative data and elicit risk and loss aversion preferences that are key determinants of entrepreneurial activity. The Centre will work with industry bodies including the Federation of Small Businesses, the Confederation of British Industry (UK), and Bpifrance (France), and with tax authorities in France, Denmark and the UK to match survey responses to administrative tax records.
Financial Transaction Data
France + Expansion
The Centre will develop the systematic use of financial transaction data — including bank data and Pitchbook data — to better understand the relationship between corporate and personal finances of entrepreneurs. The team has access to unique bank data for roughly 10% of the French population, with complete information on individual assets, balance sheets, consumption and income, as well as financials of firms they own. The feasibility of using similar data for other countries will be explored.
Public data resources
Available now
HathiTrust Catalogue of US Property Tax Records
Historical · USA
A systematic catalogue of historical property tax records from across the United States, drawn from the HathiTrust digital library. Property tax records are among the oldest systematic records of individual wealth in the US and offer a long-run window into wealth distribution, business ownership, and the effects of taxation stretching back to the early nineteenth century. This resource underpins the Dray, Landais and Stantcheva (2026) paper on wealth and property taxation in the US and is directly relevant to the Centre's long-run historical data programme.
TaxLab, produced by the Institute for Fiscal Studies, is the UK's leading online resource for impartial data, explainers, and analysis of the UK tax system. It provides accessible, research-backed information on income tax, capital gains tax, inheritance tax, corporation tax, and the taxation of business owners. The Stone Centre team has close institutional ties to the IFS through Co-Director Kate Smith and other investigators, and will contribute research findings to TaxLab as the Centre's work develops.
Each year, the Stone Centre at LSE will welcome outstanding doctoral students to apply for the Stone PhD Fellowship. This fellowship is intended to support PhD students whose research aims to deepen our understanding of wealth inequality and entrepreneurship.
Eligibility
Applicants must be enrolled in the PhD program at the LSE. Candidates should have a clear research agenda aligned with the Stone Centre's focus on wealth inequality, entrepreneurship, business taxation, or innovation and its distributional consequences.
Funding
Stone PhD Fellows will receive full research funding for the duration of their fellowship. Fellows also receive a research stipend to cover costs related to data collection and analysis, conference travel, and research visits.
Fellows will be embedded in the Stone Centre community at LSE and have access to the Centre's data infrastructure, visiting researcher network, and regular workshops and seminars.
Additional Benefits
Regular engagement with Stone Centre investigators and visiting researchers from the global INTER network.
Access to the Centre's administrative data infrastructure spanning ten or more countries.
Participation in Stone Centre research workshops (three per term) and the annual joint workshop with UCL Stone Centre.
Opportunities to present research at joint European symposia with CEPR.
Career development support and mentorship from senior investigators.
How to Apply
Details on the application process will be published ahead of the Stone Centre's formal launch in September 2026. Candidates interested in the fellowship are encouraged to reach out to the Centre in advance to discuss their research interests.
Stone PhD Fellowships are competitive. A committee of Stone Centre investigators will select candidates whose research and academic goals best align with the Centre's mission to generate new scientific evidence on the causes and consequences of wealth inequality and its relationship with entrepreneurship.
Terms and Conditions
In the event that a successful applicant is awarded multiple major fellowships, their total funding package may be subject to adjustment in accordance with LSE policies.
Disbursement of funds is contingent upon recipients demonstrating satisfactory academic progress.
Fellows are expected to participate actively in Stone Centre activities, including workshops and seminars.
Full terms and conditions will be published at the time of the fellowship launch.
The Stone Centre at LSE hosts Post-Doctoral Fellowships for early-career researchers looking to develop their research agenda for two to three years following their PhD. Fellows work at the frontier of research on wealth inequality, entrepreneurship, and taxation.
Eligibility
Applicants must have completed, or be close to completing, a PhD in Economics or a closely related discipline. Candidates should demonstrate a clear and ambitious research agenda that contributes to the Stone Centre's core themes: the dynamics of wealth inequality, business asset valuation, the effects of taxation on entrepreneurship, and optimal policy design.
Funding & Duration
Post-Doctoral Fellows receive a competitive salary and research budget for a period of two to three years. Fellows are based at LSE within the Department of Economics and have access to the Stone Centre's full data infrastructure and global research network.
Additional Benefits
Direct mentorship from Stone Centre Co-Directors and investigators.
Access to unique longitudinal administrative datasets spanning ten or more countries.
Research grants for data collection, conference travel, and co-author visits.
Integration into the INTER global network and visiting affiliate programme.
Opportunities to co-organise Centre workshops and European research symposia with CEPR.
Support for academic job market placement.
How to Apply
Details on the application process will be published ahead of the Centre's formal launch in September 2026. Candidates are encouraged to contact the Stone Centre in advance to express interest and discuss their research agenda.
Through INTER — the International Network for Taxation and Entrepreneurship Research — the Stone Centre at LSE offers a visiting affiliate programme for members of other Stone Centres and external researchers worldwide who are working on wealth inequality, entrepreneurship, and taxation.
Eligibility
The visiting researcher programme is open to faculty and advanced doctoral students from partner institutions in the INTER network and beyond. Priority is given to researchers whose current work intersects directly with the Stone Centre's research agenda.
Members of existing Stone Centres — at UCL, UBC, Paris School of Economics, and elsewhere — are particularly encouraged to apply to take advantage of the geographical proximity and complementary research focus of the Stone Centre at LSE.
Duration & Support
Visits typically last between two weeks and three months. The Stone Centre covers travel and accommodation costs for visiting researchers and provides a desk in the Centre's working space, access to the LSE library and research facilities, and participation in all Stone Centre events and workshops during the visit.
Additional Benefits
Access to Stone Centre data infrastructure and INTER research repository.
Opportunity to present research at Stone Centre seminars and workshops.
Collaboration opportunities with Stone Centre investigators and PhD students.
Integration into the London research community, including the IFS-STICERD Public Economics Seminar and the annual LSE-IFS-UCL Conference.
How to Apply
Details on the visiting researcher application process will be published following the Centre's formal launch in September 2026. Researchers interested in visiting are encouraged to contact the Centre in advance to discuss timing and research alignment.
The Stone Centre team has a long track record of translating frontier academic research into direct policy recommendations at the highest levels of government.
Two members of the Stone Centre team — Camille Landais and Xavier Jaravel — serve or have served as Chairman of the French Council of Economic Advisers, an independent body reporting directly to the French Prime Minister. Their work on capital taxation, wealth taxes, and entrepreneurship policy has shaped the French policy debate at the highest level, including providing the empirical grounding for the debate over global billionaire taxes at the G20.
Institute for Fiscal Studies — UK
Bridging research and UK policymaking
Kate Smith, Camille Landais, Johannes Spinnewijn and Xavier Jaravel are all IFS Research Fellows or Affiliates. The IFS is the UK's leading independent economic research organisation. The Stone Centre team's research on capital taxation and business ownership has been disseminated through the IFS, including through IFS TaxLab and the IFS Deaton Review of Inequalities — shaping UK parliamentary debate on business taxation, inheritance tax reform, and capital gains tax design.
Policy publications
Briefs and reports
Policy Brief · French CAE
Capital Taxation: What are the Effects of Tax-Induced Emigration on the Economy?
Laurent Bach, Antoine Bozio, Nicolas Grimprel, Arthur Guillouzic, Camille Landais & Clément Malgouyres
Provides original empirical evidence that capital taxes have a significant — but modest — effect on the emigration of the wealthiest individuals from France. Even accounting for the disproportionate weight of high-net-worth individuals in entrepreneurial activity, the aggregate economic impact of this emigration is limited. This note directly reinforces the key message of the Scandinavian migration paper: tax-induced emigration by the wealthy is real but its macroeconomic consequences are considerably smaller than assumed in political debate.
Aggregate impact of a €4bn wealth-tax increaseSource: Focus du CAE No. 118, 2025
Policy Brief · CEPR / Pension Reform
From Pension Reforms to Welfare: A Unifying Framework
Camille Landais & Johannes Spinnewijn
Develops a unifying framework for evaluating the welfare effects of pension reforms, providing a practical tool for policymakers applicable across different country contexts. Published as Chapter 5 of the CEPR E-Book Rethinking Pension Reform.
Innovation and Social Mobility: Two Sides of the Same Coin
Xavier Jaravel, Philippe Aghion & Richard Blundell
A report for the UK Social Mobility Commission examining how innovation policy and social mobility are deeply interconnected. Access to innovation careers is unevenly distributed — and this shapes the direction of innovation in ways that exacerbate inequality. The report provides policy recommendations for widening access to inventive careers.
A research brief for the IMF on how democratising access to innovation careers can harness untapped talent and spur economic growth. The brief argues that the demographic composition of the innovator pool is a significant and underexplored determinant of both aggregate growth and distributional outcomes.
Camille Landais co-authored an early proposal, with Emmanuel Saez and Gabriel Zucman, for a coordinated European wealth tax — a template that fed into the global minimum tax on billionaires later championed by Zucman and debated at the G20. The team's own Scandinavian migration paper subsequently provided an important empirical anchor for that debate: its finding that the aggregate economic consequences of wealth-tax-induced migration are modest countered assertions that a global billionaire tax would trigger mass capital flight.
Expensive, distortionary and inequitable: time to sort out the way we tax business owners
Coverage of Smith, Miller & Pope's finding that tax breaks for business owners do not boost investment but significantly reduce tax revenues from high-income business owners.
Entrepreneurs' relief criticised by Institute for Fiscal Studies
The Times covered the IFS research by Smith, Miller & Pope on the cost and limited effectiveness of preferential capital gains tax rates for business owners — focusing on policy implications for Entrepreneurs' Relief.
Entrepreneurs' tax break fails to boost investment, says IFS
The Guardian covered the Smith, Miller & Pope finding that tax-motivated profit retention by UK business owners does not translate into increased productive investment.
UK's top 0.1% earners have annual income of over half a million
The Guardian also covered the Deaton Review chapter, highlighting how differentials in tax treatment of capital income versus labour income constrain progressivity of the UK system.
If Mamdani Raises NYC Taxes, Will the Wealthy Leave the City?
Forbes examines whether New York's wealthiest residents would leave the city in response to the tax increases proposed by mayoral candidate Zohran Mamdani, set against the wider debate on how the wealthy respond to higher taxation.
Smith, Delestre, Kopczuk & Miller's Deaton Review chapter was summarised in a VoxEU column, reaching the wider international academic and policy community.
Gabriel Zucman's public lecture at STICERD, LSE, setting out the case for a global minimum tax on billionaires and responding to the leading objections raised in the policy debate.
Xavier Jaravel's LSE inaugural lecture on the democratisation of innovation. Among children with similar abilities, those from wealthy backgrounds have a far greater likelihood of becoming inventors. The lecture presents the case for unlocking the talent of "lost Einsteins" and "lost Marie Curies."
From Pension Reforms to Welfare — Camille Landais & Johannes Spinnewijn
A video accompanying the CEPR e-book chapter by Landais and Spinnewijn on pension reform and welfare design — translating frontier research into a practical tool for policymakers across different country contexts.
The Stone Centre formally launches in September 2026. The programme will include three Stone research workshops each term for affiliates, an annual joint workshop with UCL Stone Centre, and periodic joint European research symposia with CEPR.
Past highlights
Selected events
OCT 2026
Department of Economics · LSE
Roland Lescure on France's Economic Challenges and Future Prospects
France's Minister of the Economy and Finance and LSE alumnus (MSc Economics, 1992) returned to LSE for a conversation with students from LSE and the Lycée Français Charles de Gaulle, chaired by Stone Centre Co-Director Camille Landais. The discussion covered growth, fiscal responsibility, France's borrowing costs and European competitiveness and digital sovereignty. Read more →
MAY 20 2026
STICERD · LSE
We Need to Tax Billionaires — Gabriel Zucman
Gabriel Zucman's public lecture at STICERD, LSE, setting out the case for a global minimum tax on billionaires and responding to the leading objections raised in the policy debate. Recording available →
SEP 22 2025
IFS · LSE · UCL
IFS-LSE-UCL Workshop on Public Economics
A two-day academic workshop on public economics jointly organised by the IFS, LSE and UCL — the first in what is intended to become an annual fixture. Speakers included Owen Zidar (Princeton), Juan Carlos Suarez Serrato (Stanford) and Molly Schnell (Northwestern), alongside researchers from LSE, UCL and IFS. Funded by the ESRC Centre for the Microeconomic Analysis of Public Policy (CPP) at IFS. Event details →
FEB 27 2025
LSE Inaugural Lecture Series
The Lost Marie Curies — Xavier Jaravel
Xavier Jaravel's LSE inaugural lecture on the democratisation of innovation. Recording available →
JUN 14 2023
STICERD · IFS · Stone Centre at UCL · CEPR
CEPR Public Economics Annual Symposium — Wealth & Capital Taxation
A three-day CEPR Public Economics Annual Symposium hosted at STICERD, LSE, with special focus that year on wealth and capital taxation. Keynote by Joel Slemrod (Michigan); confirmed speakers included Fatih Guvenen, Florian Scheuer, Owen Zidar and Eric Zwick. Event details →
The Stone Centre on Wealth Inequality and Entrepreneurship at LSE is a research initiative dedicated to advancing understanding of one of the defining questions of our time: what is the relationship between entrepreneurship and the growing concentration of wealth, and what can governments do about it?
Based in the Department of Economics, the Stone Centre brings together world-leading economists from across macroeconomics, public finance, corporate finance, and the economics of innovation. The Centre formally launches in September 2026.
The Centre is part of the Stone Foundation's growing global network of research centres, all sharing a commitment to generating rigorous, independent evidence on wealth inequality. Our unique focus on entrepreneurship fills a critical gap. Top wealth holders in the US and Europe directly own more than half of all privately held companies. The top 1% control business assets representing over 15% of national employment and value-added in most European countries — yet we know remarkably little about the entrepreneurial content of these assets, how they are valued, or how they respond to policy.
Over an initial six-year period, the Centre will build new data infrastructure spanning several countries, publish frontier research in the world's leading academic journals, create the International Network for Taxation and Entrepreneurship Research (INTER), and engage directly with policymakers in the UK, France, and internationally.
