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Distribution of wealth

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The distribution of wealth is a comparison of the wealth of various members or groups in a society. It differs from the income distribution in that it looks at the distribution of ownership of the assets in a society, rather than the current income of members of that society. The distribution of wealth shows economic inequality as per the Gini index.

Definition of wealth

Main article: Wealth

Wealth in the context of this article is defined as a person's net worth, expressed as:

wealth = assets − liabilities

The word wealth is often confused with income. These two terms describe different but related things. Wealth consists of those items of economic value that an individual owns, while income is an inflow of items of economic value. (See Stock and flow.) The relation between wealth, income, and expenses is:

change of wealth = income − expense.

The distribution of income is substantially different from the distribution of wealth. According to the International Association for Research in Income and Wealth, "the world distribution of wealth is much more unequal than that of income."[1]

If an individual has a large income but also large expenses, the net effect of that income on her or his wealth could be small or even negative.

The United Nations definition of inclusive wealth is a monetary measure which includes the sum of natural, human and physical assets.[2][3]

Data about global distribution of wealth

Share of wealth globally by year[4]

The vast and growing gap between rich and poor has been laid bare. The gap between the rich and poor can be illustrated by the fact that the three wealthiest individuals in the world have assets that exceed those of the poorest 10 percent of the world's population.[5] The net worth of the world's billionaires increased from less than $1 trillion in 2000 to over $7 trillion in 2015 so the gap is growing up dramatically. Statistics shows 28.4 million slaves at the end of 2006 was living in the world with zero wealth. The right hand-side fig shows millionaires as 1 percent of the world population who possess more than half of global wealth.

Wealth distribution pyramid

Personal wealth varies across adults for many reasons. Some individuals with little wealth may be at early stages in their careers, with little chance or motivation to accumulate assets. Others may have suffered business setbacks or personal misfortunes, or live in parts of the world where opportunities for wealth creation are severely limited. At the other end of the spectrum, there are individuals who have acquired a large fortune through a combination of talent, hard work or simply being in the right place at the right time. The wealth pyramid below was prepared by Credit Suisse in 2013; it captures these differences in striking detail. It has a large base of low wealth holders, alongside upper tiers occupied by progressively fewer people. In 2013 Credit-suisse estimate that 3.2 billion individuals – more than two thirds of adults in the world – have wealth below 10,000 USD. A further one billion(adult population) fall within the 10,000 – 100,000 USD range. While the average wealth holding is modest in the base and middle segments of the pyramid, their total wealth amounts to USD 40 trillion, underlining the potential for novel consumer products and innovative financial services targeted at this often neglected segment.[6]

The pyramid reveals that:

  • half of the world's wealth belongs to the top 1%,
  • top 10% of adults hold 85%, while the bottom 90% hold the remaining 15% of the world's total wealth,
  • top 30% of adults hold 97% of the total wealth.
Pyramid of global wealth distribution in 2013[6]

Wealth distribution in 2012

According to the OECD in 2012 the top 0.6% of world population (consisting of adults with more than 1 million USD in assets) or the 42 million richest people in the world held 39.3% of world wealth. The next 4.4% (311 million people) held 32.3% of world wealth. The bottom 95% held 28.4% of world wealth. The large gaps of the report get by the Gini index to 0.893, and are larger than gaps in global income inequality, measured in 2009 at 0.38.[7] For example, in 2012 the bottom 60% of the world population held same wealth in 2012 as the people on Forbes' Richest list consisting of 1,226 richest billionaires of the world.

Statistical distributions

There are many ways in which the distribution of wealth can be analyzed. One example is to compare the wealth of the richest one percent with the wealth of the median (or 50th) percentile. In many societies, the richest ten percent control more than half of the total wealth.

Pareto Distribution has often been used to mathematically quantify the distribution of wealth, since it models a random distribution.

Wealth over people (WOP) curves are a visually compelling way to show the distribution of wealth in a nation. WOP curves are modified distribution of wealth curves. The vertical and horizontal scales each show percentages from zero to one hundred. We imagine all the households in a nation being sorted from richest to poorest. They are then shrunk down and lined up (richest at the left) along the horizontal scale. For any particular household, its point on the curve represents how their wealth compares (as a proportion) to the average wealth of the richest percentile. For any nation, the average wealth of the richest 1/100 of households is the topmost point on the curve (people, 1%; wealth, 100%) or (p=1, w=100) or (1, 100). In the real world two points on the WOP curve are always known before any statistics are gathered. These are the topmost point (1, 100) by definition, and the rightmost point (poorest people, lowest wealth) or (p=100, w=0) or (100, 0). This unfortunate rightmost point is given because there are always at least one percent of households (incarcerated, long term illness, etc.) with no wealth at all. Given that the topmost and rightmost points are fixed … our interest lies in the form of the WOP curve between them. There are two extreme possible forms of the curve. The first is the "perfect communist" WOP. It is a straight line from the leftmost (maximum wealth) point horizontally across the people scale to p=99. Then it drops vertically to wealth = 0 at (p=100, w=0).

The other extreme is the "perfect tyranny" form. It starts on the left at the Tyrant's maximum wealth of 100%. It then immediately drops to zero at p=2, and continues at zero horizontally across the rest of the people. That is, the tyrant and his friends (the top percentile) own all the nation's wealth. All other citizens are serfs or slaves. An obvious intermediate form is a straight line connecting the left/top point to the right/bottom point. In such a "Diagonal" society a household in the richest percentile would have just twice the wealth of a family in the median (50th) percentile. Such a society is compelling to many (especially the poor). In fact it is a comparison to a diagonal society that is the basis for the Gini values used as a measure of the disequity in a particular economy. These Gini values (40.8 in 2007) show the United States to be the third most dis-equitable economy of all the developed nations (behind Denmark and Switzerland). The US WOP Curve is shown below. As you will see it approaches the "tyrant's curve".

A curve that is visually appealing is the quarter-circle curve or the wagon wheel WOP. Some reformers feel that any nation's tax system should be set up so that its WOP never gets sucked in beyond the wagon wheel form.

More sophisticated models have also been proposed.[8]

Redistribution of wealth and public policy

See also: Redistribution of wealth

In many societies, attempts have been made, through property redistribution, taxation, or regulation, to redistribute wealth, sometimes in support of the upper class, and sometimes to diminish extreme inequality.

Examples of this practice go back at least to the Roman republic in the third century B.C.,[9] when laws were passed limiting the amount of wealth or land that could be owned by any one family. Motivations for such limitations on wealth include the desire for equality of opportunity, a fear that great wealth leads to political corruption, to the belief that limiting wealth will gain the political favor of a voting bloc, or fear that extreme concentration of wealth results in rebellion.[10] Various forms of socialism attempt to diminish the unequal distribution of wealth and thus the conflicts and social problems (see image below) arising from it.[11]

During the Age of Reason, Francis Bacon wrote "Above all things good policy is to be used so that the treasures and monies in a state be not gathered into a few hands… Money is like fertilizer, not good except it be spread."[12]

Communism arose as a reaction to a distribution of wealth in which a few lived in luxury while the masses lived in extreme poverty. In The Communist Manifesto, Marx and Engels wrote "From each according to his ability, to each according to his need."[13] While the ideas of Marx have nominally been embraced by various states (Russia, Cuba, Vietnam and China in the 20th century), Marxist utopia remains elusive.[14]

On the other hand, the combination of labor movements, technology, and social liberalism has diminished extreme poverty in the developed world today, though extremes of wealth and poverty continue in the Third World.[15]

In the Outlook on the Global Agenda 2014 from the World Economic Forum the widening income disparities come second as a worldwide risk.[16][17]

Wealth surveys

Many countries have national wealth surveys, for example:

21st century

At the end of the 20th century, wealth was concentrated among the G8 and Western industrialized nations, along with several Asian and OPEC nations.

Wealth inequality

A study by the World Institute for Development Economics Research at United Nations University reports that the richest 1% of adults alone owned 40% of global assets in the year 2000, and that the richest 10% of adults accounted for 85% of the world total. The bottom half of the world adult population owned 1% of global wealth.[18] Moreover, another study found that the richest 2% own more than half of global household assets.[19]

Real estate

While sizeable numbers of households own no land, few have no income. For example, 10% of land owners (all corporations) in Baltimore, Maryland own 58% of the taxable land value. The bottom 10% of those who own any land own less than 1% of the total land value.[20] This form of analysis as well as Gini coefficient analysis has been used to support land value taxation.

Credit Suisse Report - Wealth Distribution & Gini (2013)

This table was created from information provided by the Credit Suisse, Research Institute's "Global Wealth Databook", published 2013.[21]

Country Adults
(1000s) 		Wealth per
adult (USD) 		Proportion of adults (%) by wealth range (USD) Gini
(%)
Mean Median Under 10k 10k – 100k 100k – 1M Over 1M Total
 Denmark 4,190 255,066 57,675 39.5 17 37.8 5.7 100 107.7
 Russian Federation 110,365 10,976 871 93.7 5.6 0.6 0.1 100 93.1
 Ukraine 35,912 3,413 419 97.4 2.3 0.2 0 100 90
 Kazakhstan 10,958 7,161 1,176 93.1 6.3 0.6 0.1 100 86.7
 Lebanon 2,953 30,868 6,076 66.8 29.8 3.2 0.3 100 86.3
 United States of America 239,279 301,140 44,911 30.7 33 30.7 5.5 100 85.1
 Zimbabwe 6,690 2,913 479 93.9 5.8 0.3 0 100 83.8
 Turkey 51,687 25,909 5,326 67 30.3 2.5 0.2 100 83.7
 South Africa 31,034 19,613 3,051 72.3 24.9 2.6 0.1 100 83.6
 Hong Kong, China 6,052 153,312 32,384 30.3 49.7 18.3 1.7 100 83.1
 Philippines 56,730 8,799 1,849 88.1 11.1 0.8 0.1 100 82.9
 Indonesia 157,869 11,839 2,393 81.1 17.6 1.3 0.1 100 82.8
 Thailand 49,642 7,772 1,855 90.5 8.8 0.6 0 100 82.6
 Venezuela 18,991 6,900 1,505 90.9 8.5 0.6 0 100 82.5
 Brazil 135,385 23,278 5,117 66.6 30.5 2.7 0.2 100 82.1
 Malaysia 18,382 27,007 5,831 61.4 35.3 3.1 0.2 100 81.5
 Chile 12,461 49,032 11,742 45 48 6.6 0.4 100 81.4
 India 767,612 4,706 1,040 94.4 5.2 0.3 0 100 81.3
 Switzerland 6,101 512,562 95,916 5.2 46 38.8 10 100 80.6
 Sweden 7,299 299,441 52,677 15.6 48.3 29.2 6.9 100 80.3
 Egypt 52,710 7,285 1,852 90.4 9 0.6 0 100 80.3
 Nigeria 80,462 3,620 894 94.9 4.9 0.3 0 100 80
 Colombia 30,464 26,222 6,228 60.2 35.8 3.9 0.2 100 79.7
 Seychelles 54 60,003 14,617 40 50 9.2 0.8 100 79.6
 Argentina 28,265 15,638 4,032 72.1 26.1 1.7 0.1 100 79.6
 Saudi Arabia 16,694 37,346 9,772 53.3 41.1 5.3 0.3 100 79.3
 Namibia 1,256 19,899 4,531 67.5 28.3 4.2 0.1 100 78.7
 Israel 4,947 137,351 38,164 30 44.8 23.7 1.5 100 78.7
 Comoros 388 2,872 670 93.8 6.1 0.2 0 100 78.7
 Cyprus 694 119,568 34,874 23.8 56.3 18.6 1.4 100 78.3
 Mexico 73,380 35,872 9,718 53.5 40.6 5.7 0.3 100 78
 Norway 3,733 380,473 92,859 19.4 32.5 40.6 7.5 100 77.8
 Austria 6,761 203,931 57,450 28.2 31.8 37 3 100 77.8
 Libya 4,291 28,397 6,563 58.1 35.7 6 0.1 100 77.7
 Botswana 1,181 10,348 2,649 81 17.6 1.4 0 100 77.2
 Germany 67,068 192,232 49,370 29 33.3 35.1 2.6 100 77.1
 Haiti 5,813 3,532 960 92.3 7.5 0.2 0 100 76.1
 Angola 9,273 14,708 3,934 69.1 28.8 2.1 0 100 75.6
 Central African Republic 2,370 800 241 99.1 0.9 0 0 100 74.8
 Bolivia 5,800 4,604 1,368 89.3 10.4 0.3 0 100 74.4
 Zambia 6,151 1,817 548 96.8 3.2 0 0 100 74.1
 Czech Republic 8,437 44,975 15,541 40 53.2 6.4 0.3 100 74
 Singapore 3,955 281,764 90,466 20 34.2 41.4 4.4 100 73.9
 Kuwait 2,291 119,101 42,897 21.8 55.5 21.5 1.2 100 73.8
 Poland 30,255 26,056 9,109 55 41.5 3.3 0.1 100 73.7
 Taiwan 18,359 151,752 53,336 22.5 45.1 30.8 1.7 100 73.6
 Netherlands 12,914 185,588 83,631 23.3 30.9 43.6 2.2 100 73.2
 Belize 188 9,998 3,130 76.3 22.6 1.1 0 100 73.1
 Suriname 344 14,250 4,544 68.8 29.6 1.6 0 100 73
 Nicaragua 3,424 3,432 1,147 92.5 7.3 0.1 0 100 73
 Romania 16,692 14,044 5,137 69.3 29.2 1.4 0.1 100 73
 Lesotho 1,079 3,457 1,105 92.4 7.5 0.1 0 100 72.9
 Paraguay 3,910 10,934 3,726 73.2 25.6 1.3 0 100 72.8
 Swaziland 628 4,360 1,393 90 9.8 0.2 0 100 72.7
 Panama 2,322 22,292 7,509 57.3 38.5 4.2 0 100 72.7
 Rwanda 5,306 723 245 99.3 0.7 0 0 100 72.7
 Sao Tome and Principe 86 2,721 959 94.3 5.7 0.1 0 100 72.7
 Canada 27,173 251,034 90,252 30 21.5 44.9 3.7 100 72.7
 South Korea 38,350 79,475 30,938 25.3 59.5 14.5 0.7 100 72.6
 Papua New Guinea 3,752 8,470 2,821 81.1 18 0.8 0 100 72.4
 Cape Verde 295 16,313 5,478 65 32.5 2.5 0 100 72.3
 Antigua and Barbuda 63 19,011 6,281 58.8 38.3 3 0 100 72.2
 Costa Rica 3,246 28,124 9,532 54.1 40.2 5.7 0.1 100 72.2
 Dominica 50 24,086 8,349 55 40.3 4.7 0.1 100 72
 St. Kitts and Nevis 34 23,613 8,185 56.3 39.1 4.6 0.1 100 71.9
 St. Vincent and the Grenadines 71 10,196 3,492 73.8 25.1 1.1 0 100 71.9
 Grenada 67 14,473 5,017 67.5 30.7 1.7 0 100 71.9
 New Zealand 3,234 182,548 76,607 25.6 34.1 38.1 2.3 100 71.8
 Ecuador 8,723 12,350 4,403 69.8 28.8 1.4 0 100 71.4
 El Salvador 3,738 12,039 4,483 70 28.7 1.3 0 100 71
 Ireland 3,488 183,804 75,573 20.9 36.5 40.4 2.2 100 70.9
 Kenya 20,757 2,843 1,049 94.2 5.7 0.1 0 100 70.9
 Oman 1,872 48,415 18,152 40 47.8 12 0.2 100 70.8
 Peru 18,865 18,227 6,705 58.5 38.9 2.6 0 100 70.8
 Gambia 908 864 324 99.2 0.8 0 0 100 70.8
 Congo-Brazzaville 2,024 3,892 1,420 91.2 8.6 0.1 0 100 70.8
 United Arab Emirates 3,777 126,791 51,882 20 50.6 28.2 1.3 100 70.5
 Qatar 1,278 153,294 58,237 25 38.3 35 1.7 100 70.5
 Portugal 8,614 89,074 38,846 25.8 54.8 18.7 0.8 100 70.1
 Mozambique 11,441 811 313 99.3 0.7 0 0 100 70
 Jamaica 1,719 11,401 4,393 70 28.8 1.2 0 100 69.9
 Uruguay 2,400 47,002 17,998 39.6 48.3 11.9 0.2 100 69.8
 Uganda 15,107 750 294 99.4 0.6 0 0 100 69.6
 DR Congo 31,854 321 124 99.9 0.1 0 0 100 69.6
 China 998,254 22,230 8,023 58.4 39.1 2.4 0.1 100 69.5
 Madagascar 10,359 448 177 99.8 0.2 0 0 100 69.4
 Guyana 474 3,801 1,506 91.6 8.3 0.1 0 100 69.2
 Fiji 523 6,473 2,630 85 14.6 0.4 0 100 69
 France 48,124 295,933 141,850 21.7 22.9 50.8 4.6 100 69
 Barbados 200 22,289 8,108 55 41.5 3.5 0 100 69
 Eritrea 2,781 2,125 875 96.3 3.7 0 0 100 68.9
 Macedonia, FYR 1,561 11,543 4,743 69.3 29.6 1.1 0 100 68.8
 Sierra Leone 2,897 681 273 99.6 0.4 0 0 100 68.8
 Ghana 13,501 1,811 743 97.7 2.3 0 0 100 68.6
 St. Lucia 119 13,087 5,296 66.3 32.5 1.2 0 100 68.5
 Tunisia 7,452 21,084 8,823 55 41.5 3.5 0 100 68.2
 Gabon 869 21,860 9,240 55 41.3 3.7 0 100 68.2
 Solomon Islands 298 9,868 4,261 73.8 25.3 1 0 100 68.1
 Morocco 21,355 11,398 4,750 70 28.9 1.1 0 100 68.1
 Côte d'Ivoire 11,501 2,640 1,104 95 4.9 0.1 0 100 68.1
 Sri Lanka 14,326 5,033 2,101 87.9 11.9 0.2 0 100 68
 Turkmenistan 3,352 36,570 15,305 40 52.1 7.8 0.1 100 68
 Georgia 3,172 21,640 9,178 54.7 41.8 3.5 0 100 68
 Togo 3,693 2,450 1,049 95.6 4.3 0 0 100 67.9
 United Kingdom 48,220 243,570 111,524 18 28.8 50 3.2 100 67.7
 Mauritania 1,832 1,967 865 97 3 0 0 100 67.7
 Burkina Faso 7,721 1,273 543 98.7 1.3 0 0 100 67.7
 Djibouti 508 3,465 1,488 92.8 7.2 0.1 0 100 67.5
 Chad 5,485 1,131 483 99 1 0 0 100 67.5
 Trinidad and Tobago 987 15,088 6,459 60 38.5 1.5 0 100 67.4
 Malawi 7,417 207 89 100 0 0 0 100 67.3
 Guinea 5,301 882 380 99.4 0.6 0 0 100 67.3
 Iceland 253 211,592 104,733 20 30 47.3 2.7 100 67.3
 Tonga 54 15,905 7,217 58.8 39.8 1.5 0 100 67.2
 Senegal 6,423 2,597 1,125 95.3 4.7 0 0 100 67.2
 Cameroon 10,459 2,603 1,115 95.2 4.8 0 0 100 67.2
 Vanuatu 138 6,068 2,753 85 14.7 0.3 0 100 67.1
 Benin 4,733 3,187 1,398 93.6 6.3 0.1 0 100 67.1
 Samoa 92 34,537 15,132 40 53 6.9 0.1 100 67
 Cambodia 9,151 2,644 1,155 95 4.9 0 0 100 67
 Yemen 12,192 4,951 2,193 88.3 11.6 0.2 0 100 66.8
 Iran 53,270 8,727 3,846 75 24.4 0.6 0 100 66.8
 Liberia 2,118 2,173 987 96.5 3.5 0 0 100 66.7
 Tanzania 22,038 951 423 99.3 0.7 0 0 100 66.6
 Laos 3,618 5,393 2,411 86.7 13.1 0.2 0 100 66.5
 Lithuania 2,537 23,411 10,635 47.5 48.5 3.9 0 100 66.5
 Myanmar 34,180 2,214 941 97 3 0 0 100 66.4
 Finland 4,195 171,821 95,095 29 22.3 47.2 1.6 100 66.4
 Maldives 210 5,556 2,480 85 14.8 0.2 0 100 66.3
 Bahamas 242 41,106 17,842 35 55.9 9 0.1 100 66.2
 Spain 37,206 123,997 63,306 17.4 52.4 29 1.1 100 66.1
 Mongolia 1,855 14,214 6,433 61.1 37.6 1.3 0 100 66.1
 Syrian Arab Republic 13,352 7,073 3,198 82.7 16.9 0.4 0 100 66
 Latvia 1,787 24,285 11,338 45 50.9 4 0 100 66
 Greece 9,105 102,971 53,937 20.4 53.7 25.1 0.8 100 65.9
 Jordan 3,858 14,364 6,589 60.3 38.3 1.4 0 100 65.9
 Kyrgyz Republic 3,568 5,385 2,432 85.9 13.9 0.2 0 100 65.9
 Viet Nam 61,765 4,857 2,215 87.8 12 0.2 0 100 65.8
 West Bank and Gaza 1,739 8,979 4,200 73.1 26.3 0.6 0 100 65.8
 Equatorial Guinea 365 19,525 9,130 55 42.6 2.4 0 100 65.8
 Bosnia and Herzegovina 2,985 11,173 5,139 68.2 30.9 0.9 0 100 65.8
 Luxembourg 390 315,240 182,768 15 22.5 57 5.5 100 65.7
 Estonia 1,055 33,701 15,724 40 53.3 6.6 0.1 100 65.7
 Guinea-Bissau 836 424 199 99.9 0.1 0 0 100 65.7
 Albania 2,237 9,450 4,451 72.7 26.6 0.7 0 100 65.6
 Niger 7,014 937 434 99.3 0.7 0 0 100 65.5
 Algeria 23,982 10,100 4,673 70 29.2 0.7 0 100 65.5
 Sudan 23,811 1,291 595 98.9 1.1 0 0 100 65.4
 Burundi 4,729 293 137 99.9 0.1 0 0 100 65.2
 Azerbaijan 6,276 16,344 7,721 57.1 41.4 1.5 0 100 65.1
 Croatia 3,498 26,551 12,639 41.2 54.1 4.7 0 100 65.1
 Italy 49,117 241,383 138,653 20 20.5 56.5 3 100 65
 Mali 6,464 955 455 99.4 0.6 0 0 100 64.7
 Moldova 2,692 3,854 1,874 91.8 8.1 0.1 0 100 64.7
 Nepal 17,273 1,998 951 97.7 2.3 0 0 100 64.7
 Bangladesh 104,135 1,894 908 97.9 2.1 0 0 100 64.6
 Mauritius 935 37,308 19,247 40 52.5 7.4 0.1 100 64.5
 Hungary 7,915 28,379 14,068 40 55 4.9 0 100 64
 Armenia 2,263 5,613 2,793 85.5 14.3 0.2 0 100 63.9
 Tajikistan 4,022 3,168 1,581 94.3 5.7 0.1 0 100 63.8
 Pakistan 106,365 4,248 2,106 90.8 9 0.1 0 100 63.8
 Ethiopia 42,750 411 207 99.9 0.1 0 0 100 63.6
 Australia 16,617 402,578 219,505 6.9 23.7 62.6 6.8 100 63.6
 Japan 104,315 216,694 110,294 9.2 37.7 50.6 2.5 100 63.5
 Montenegro 467 21,340 10,929 45 52.6 2.4 0 100 63.4
 Belgium 8,387 255,573 148,141 17.4 22.1 57.3 3.2 100 62.6
 Serbia 7,527 15,175 7,978 56.8 42 1.3 0 100 62.5
 Bulgaria 5,991 16,818 8,825 55.2 43.4 1.4 0 100 62.5
 Belarus 7,543 2,407 1,271 96.8 3.1 0 0 100 62.2
 Malta 330 71,448 42,898 18.8 65 15.9 0.3 100 59.5
 Bahrain 571 44,822 26,675 28.7 60 11.2 0 100 58.5
 Brunei Darussalam 286 51,373 31,527 26.2 58.7 15 0 100 58.5
 Slovenia 1,655 64,067 44,932 19.4 60.6 19.9 0.1 100 53.5
 Slovakia 4,303 27,224 20,740 19.8 77.8 2.4 0 100 44.7

In the United States

See also: Wealth inequality in the United States, Income inequality in the United States, and Wealth in the United States

Distribution of net worth in the United States (2007).[22] The net wealth of many people in the lowest 20% is negative because of debt.[22] By 2014, the wealth gap deepened.

  Top 1% (34.6%)
  Next 4% (27.3%)
  Next 5% (11.2%)
  Next 10% (12%)
  Upper Middle 20% (10.9%)
  Middle 20% (4%)
  Bottom 40% (0.2%)

According to PolitiFact and others, in 2011 the 400 wealthiest Americans "have more wealth than half of all Americans combined."[23][24][25][26] Inherited wealth may help explain why many Americans who have become rich may have had a "substantial head start".[27][28] In September 2012, according to the Institute for Policy Studies, "over 60 percent" of the Forbes richest 400 Americans "grew up in substantial privilege".[29]

In 2007, the richest 1% of the American population owned 34.6% of the country's total wealth (excluding human capital), and the next 19% owned 50.5%. The top 20% of Americans owned 85% of the country's wealth and the bottom 80% of the population owned 15%. From 1922 to 2010, the share of the top 1% varied from 19.7% to 44.2%, the big drop being associated with the drop in the stock market in the late 1970s. Ignoring the period where the stock market was depressed (1976–1980) and the period when the stock market was overvalued (1929), the share of wealth of the richest 1% remained extremely stable, at about a third of the total wealth.[30] Financial inequality was greater than inequality in total wealth, with the top 1% of the population owning 42.7%, the next 19% of Americans owning 50.3%, and the bottom 80% owning 7%.[31] However, after the Great Recession which started in 2007, the share of total wealth owned by the top 1% of the population grew from 34.6% to 37.1%, and that owned by the top 20% of Americans grew from 85% to 87.7%. The Great Recession also caused a drop of 36.1% in median household wealth but a drop of only 11.1% for the top 1%, further widening the gap between the 1% and the 99%.[22][30][31] During the economic expansion between 2002 and 2007, the income of the top 1% grew 10 times faster than the income of the bottom 90%. In this period 66% of total income gains went to the 1%, who in 2007 had a larger share of total income than at any time since 1928.

Dan Ariely and Michael Norton show in a study (2011) that US citizens across the political spectrum significantly underestimate the current US wealth inequality and would prefer a more egalitarian distribution of wealth, raising questions about ideological disputes over issues like taxation and welfare.[32]

Wealth proportion by population by year[30][33]
Year Bottom
99% 		Top
1%
1922 63.3% 36.7%
1929 55.8% 44.2%
1933 66.7% 33.3%
1939 63.6% 36.4%
1945 70.2% 29.8%
1949 72.9% 27.1%
1953 68.8% 31.2%
1962 68.2% 31.8%
1965 65.6% 34.4%
1969 68.9% 31.1%
1972 70.9% 29.1%
1976 80.1% 19.9%
1979 79.5% 20.5%
1981 75.2% 24.8%
1983 69.1% 30.9%
1986 68.1% 31.9%
1989 64.3% 35.7%
1992 62.8% 37.2%
1995 61.5% 38.5%
1998 61.9% 38.1%
2001 66.6% 33.4%
2004 65.7% 34.3%
2007 65.4% 34.6%
2010 64.6% 35.4%

Data, charts, and graphs

World distribution of wealth

Main article: World distribution of wealth
  • world distribution of wealth by country (PPP)
    world distribution of wealth by country (PPP)
  • world distribution of wealth by region (PPP)
    world distribution of wealth by region (PPP)
  • world distribution of wealth by country (exchange rates)
    world distribution of wealth by country (exchange rates)
  • world distribution of wealth by region (exchange rates)
    world distribution of wealth by region (exchange rates)

By region

Region Proportion of world… (%)[30][34]
Population Net worth… GDP…
PPP Exchange rates PPP Exchange rates
North America 5.17 27.1 34.39 23.88 33.67
Central/South America 8.52 6.51 4.34 8.49 6.44
Europe 9.62 26.42 29.19 22.8 32.4
Africa 10.66 1.52 0.54 2.36 1.01
Middle East 9.88 5.07 3.13 5.69 4.1
Asia 52.18 29.4 25.61 31.07 24.1
Other 3.15 3.7 2.56 5.4 3.38

World distribution of financial wealth

In 2007, 147 companies controlled nearly 40 percent of the monetary value of all transnational corporations.[35]

See also

References

  1. ^ James B. Davies; Susanna Sandström; Anthony F. Shorrocks; Edward N. Wolff. "Estimating the World Distribution of Household Wealth" (PDF). Institution/Country: University of Western Ontario, Canada; WIDER-UNU. Retrieved 2016-09-10.
  2. ^ Sponsored by (2012-06-30). "Free exchange: The real wealth of nations". The Economist. Retrieved 2012-07-14.
  3. ^ "Inclusive Wealth Report – IHDP". Ihdp.unu.edu. 2012-07-09. Retrieved 2012-07-14.
  4. ^ "62 people own same as half world – Oxfam | Press releases | Oxfam GB". Oxfam.org.uk. 2016-01-18. Retrieved 2016-09-10.
  5. ^ "Distribution of Wealth and Income". Boundless.com. 2016-05-26. Retrieved 2016-09-10.
  6. ^ a b "Global Wealth Report 2013". credit-suisse.com.
  7. ^ "The World Factbook – Central Intelligence Agency". Cia.gov. Retrieved 2016-09-10.
  8. ^ "Why it is hard to share the wealth". New Scientist. 2005-03-12. Retrieved 2012-03-26.
  9. ^ Livy, Rome and Italy: Books VI-X of the History of Rome from its Foundation, Penguin Classics, ISBN 0-14-044388-6
  10. ^ "… A perceived sense of inequity is a common ingredient of rebellion in societies …", Amartya Sen, 1973
  11. ^ "The Spirit Level" by Richard Wilkinson and Kate Pickett;Bloomsbury Press 2009
  12. ^ Francis Bacon, Of Seditions and Troubles
  13. ^ Karl Marx and Frederick Engels, The Communist Manifesto, Filiquarian, 2007, ISBN 978-1-59986-995-7
  14. ^ Archie Brown, The Rise and Fall of Communism, Ecco, 2009, ISBN 978-0-06-113879-9
  15. ^ Jeffrey D. Sachs, The End of Poverty, Penguin, 2006, ISBN 978-0-14-303658-6
  16. ^ "Outlook on the Global Agenda 2014 - Reports - World Economic Forum". Reports.weforum.org. Retrieved 2016-09-10.
  17. ^ "178 Oxfam Briefing Paoer" (PDF). Oxfam.org. 20 January 2014. Retrieved 2016-09-10.
  18. ^ a b The World Distribution of Household Wealth. James B. Davies, Susanna Sandstrom, Anthony Shorrocks, and Edward N. Wolff. 5 December 2006.
  19. ^ The rich really do own the world 5 December 2006
  20. ^ Kromkowski, "Who owns Baltimore", CSE/HGFA, 2007.
  21. ^ Source Credit Suisse, Research Institute - Global Wealth Databook 2013
  22. ^ a b c Recent Trends in Household Wealth in the United States: Rising Debt and the Middle-Class Squeeze—an Update to 2007 by Edward N. Wolff, Levy Economics Institute of Bard College, March 2010
  23. ^ Kertscher, Tom; Borowski, Greg (March 10, 2011). "The Truth-O-Meter Says: True - Michael Moore says 400 Americans have more wealth than half of all Americans combined". PolitiFact. Retrieved August 11, 2013.
  24. ^ Moore, Michael (March 6, 2011). "America Is Not Broke". Huffington Post. Retrieved August 11, 2013.
  25. ^ Moore, Michael (March 7, 2011). "The Forbes 400 vs. Everybody Else". michaelmoore.com. Archived from the original on 2011-03-09. Retrieved August 11, 2013. {{cite web}}: Unknown parameter |deadurl= ignored (|url-status= suggested) (help)
  26. ^ Pepitone, Julianne (September 22, 2010). "Forbes 400: The super-rich get richer". CNN. Retrieved August 11, 2013.
  27. ^ Bruenig, Matt (March 24, 2014). "You call this a meritocracy? How rich inheritance is poisoning the American economy". Salon. Retrieved August 24, 2014.
  28. ^ Staff (March 18, 2014). "Inequality - Inherited wealth". The Economist. Retrieved August 24, 2014.
  29. ^ Pizzigati, Sam (September 24, 2012). "The 'Self-Made' Hallucination of America's Rich". Institute for Policy Studies. Retrieved August 24, 2014.
  30. ^ a b c d Wealth, Income, and Power by G. William Domhoff of the UC-Santa Barbara Sociology Department
  31. ^ a b Occupy Wall Street And The Rhetoric of Equality Forbes November 1, 2011 by Deborah L. Jacobs
  32. ^ Norton, M. I., & Ariely, D., "Building a Better America – One Wealth Quintile at a Time", Perspectives on Psychological Science, January 2011 6: 9-12
  33. ^ 1922–1989 data from Wolff (1996), 1992–2010 data from Wolff (2012)
  34. ^ Data for the following table obtained from UNU-WIDER World Distribution of Household Wealth Report (The University of California also hosts a copy of the report)
  35. ^ Financial world dominated by a few deep pockets. By Rachel Ehrenberg. September 24, 2011; Vol.180 #7 (p. 13). Science News. Citation is in the right sidebar. Paper is here [1] with PDF here [2].

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