This is the second post examining parliament from the perspective of the financial statements each member of parliament (MP) submits each year to the Anti-Corruption Agency.1 The last post looked at overall net worth of MPs relative to their peers in parliament. As I mentioned in that post, the graphs obscured the fact that some MPs have much higher net worths than their annual reported incomes (both individual and family together) might otherwise suggest.

Figure 5 plots reported income percentiles against reported net worth percentiles. The data points follow the general pattern we might expect. Individuals in the lower percentiles of income also appear in the lower percentiles of overall wealth and those in the higher percentiles for income appear in the higher percentiles of wealth, creating an upward flow in the points. However, some MPs, as highlighted in red, appear in percentiles of wealth more than 30 percent higher than where they appear in terms of annual income (individual plus family). There are many plausible reasons for this, but of course not all of them are necessarily good. In the United States the Internal Revenue Service (IRS) is said to audit people in many cases because their “lifestyle appears to exceed their income.” If an individual reports only $25,000 of income per year but lives like they make $250,000 per year, then the IRS becomes suspicious that individual is not reporting accurately about their financial situation.

Income vs. Net WorthThis graph is not intended to implicate individuals (I’d rather not kick that hornets nest), and I’d like to reiterate that it is created using data reported from MPs themselves and publicly available on the Anti-Corruption Agency website. Moreover, I chose the 30% and 50% differentials arbitrarily, and they simply seemed like large differentials to me. The selection was not based on any sort of standard used to detect if one’s “lifestyle exceeds one’s income.” It is simply presented as a benchmark for comparison.

1. Anti-Corruption Agency (Авлигатай тэмцэх газар) –