probated in the 12-year period 1912-23, inclusive, was made. In addition, special and detailed information on all reported estates of $1,000,000 and over was secured for a 6-year period 1918-23, inclusive, from probate records embracing the cities of New York, Philadelphia, and Chicago. The information secured was supplemented with data obtained by the estate tax division of the Bureau of Internal Revenue.1 The results of these two studies are presented in Table I and Table II. Graph I is intended to give a picture of the relative distribution of capital at each period in comparison to a hypothetical equal distribution of capital. Of course an equal distribution of capital would result in 65% of the population having 65% of the capital, 50% of the population having 50% of the capital, 5% of the population having 5% of the capital, etc; but, as the graph and data show, this is so far from true that 65% of the population has less than 5% of the capital. It is interesting to see that the graph shows a distribution of capital nearer to equal distribution in the later period than in the earlier period.

* Estimated from the data of the Massachusetts Bureau of Labor by Dr. Willford I. King. Wealth and Income of the People of the United States, pp. 69 and 71.

1 “National Wealth and Income," Federal Trade Commission, pp. 56–7.

TABLE II

DISTRIBUTION OF ESTATES PROBATED IN SELECTED COUNTIES OF THE UNITED STATES,* 1912-23

*Federal Trade Commission. National Wealth and Income, 69th Cong., 1st Sess., Sen. Doc. No. 126, p. 58. Columns 6, 7, and 8 calculated.

Some idea of the nature and extent of the potential demand for personal trust services of the trust company may be obtained from the data presented by these studies. The distribution of wealth indicated by the Massachusetts study is enough like that indicated by the study of the Federal Trade Commission to lead to the conclusion that adequate samples have been taken and hence that deductions may be drawn from an analysis of the figures with some degree of confidence. At the same time it should be noted that the number of cases studied by the Federal Trade Commission totals only 43,512, which after all is not a large percentage of the total population; and further it may be held in mind by way of "mental reservations" that there is some evidence to the effect that the aggregate of small estates might be considerably larger than is indicated by either of these studies. The vast amount of savings deposits in the United States, the savings represented by building and loan association shares, and the aggregate of insurance on lives, totaling altogether many billions of dollars, would seem to furnish material in contradiction of the distribution of capital here shown. Moreover, the figures themselves seem to prove that the distribution of capital is more nearly the hypothetical equal distribution of capital in later times than for

merly. In the light of the "second phase of the industrial revolution" described in Chapter IX, it is no doubt true that the aggregate of the smaller estates now forms a relatively larger portion of the total national capital than it did in years past. But it is impossible to say to what extent this is true.

GRAPH I

DISTRIBUTION OF CAPITAL ILLUSTRATED BY THE LORENZ CURVE

(a) As indicated by probate records in selected counties of the United States, 1912-1923; and

(b) As indicated by probate records in Massachusetts, 1889-1891.

Cumulated percentage of total number of estates

(Cumulation beginning with estates of least value.)

The data of the Federal Trade Commission study shows that the aggregate value of estates less than $2,500 is only 2.8% of the total value represented by these 43,512 estates probated. In other words, the total amount of property represented by all the individuals having estates smaller than $2,500, which includes 45% of the number of estates probated, constitutes only 2.8%

of the total amount of capital represented by the 43,512 estates probated. Considering the expense of publicity, in educating nearly one-half the population in order to get 2.8% of the possible personal trust business, should the trust company go after this business? Again, the aggregate value of estates less than $10,000 is 13.5% of the total value of these 43,512 estates probated. That is, the total amount of capital represented by all the individuals having estates smaller than $10,000 which includes 77.5% of the number of estates probated, constitutes only 13.5% of the property represented by the total of these 43,512 estates probated. Estates probated ranging from $10,000 to $100,000 included approximately 20% of the number of estates, but in the aggregate constituted 33.7% of the total amount of property probated. Estates probated ranging from $10,000 to $250,000 in the aggregate constituted over half of the total amount of property probated, 50.2%. Out of the 43,512 estates probated only 120 were over $500,000, and 299 were over $250,000. The 299 estates over $250,000 aggregated over one-third of the total property probated-36.3%; and the 120 estates over $500,000 aggregated over one-fourth of the total property probated-27.3%. This situation is presented in Graph II, on page 399.

In order to obtain personal trust business from the smaller estates, a relatively much larger population must be educated in proportion to the amount of business which will be done; and the business would be obtained at an increasing cost, so far as advertising is concerned. The total value of estates in the smaller groups declines very rapidly: The total value of estates in the $5,000-$10,000 class is $45,000,000; the total value of the estates in the $2,500-$5,000 class is approximately $27,000,000; and the total value of the estates in the $1,000-$2,500 class is barely over $14,000,000, while all estates under $500 (of those probated) aggregate only about $1,500,000 (less than .2% of the total property probated). At the same time, as the estates become smaller, the size of the group which must be made familiar with and confident in personal trust services rapidly becomes larger.

Trust companies are not only interested in the distribution of capital as indicated by probate records, in connection with

testamentary trusts, executorships, and administratorships; but they are also interested in the distribution of capital among living persons in connection with the great variety of living

GRAPH II

PERCENTAGE OF TOTAL NUMBER AND TOTAL VALUE OF PROBATED ESTATES For specified size groups in 24 selected counties of

trusts. No such data are available, but recently a reliable statistical authority has made an estimate of the distribution of capital among the living, based upon profound analysis of all