Eight men own the same wealth as the 3.6 billion people who make up the poorest half of humanity, according to a new report published by Oxfam today to mark the annual meeting of political and business leaders in Davos.
The wealthiest 1 percent of the world's population now owns more than half of the world's wealth, according to a new report.The total wealth in the world grew by 6 percent over the past 12 months to $280 trillion, marking the fastest wealth creation since 2012, according to the Credit Suisse report. More than half of the $16.7 trillion in new wealth was in the U.S., which grew $8.5 trillion richer.But that wealth around the world is increasingly concentrated among those at the top. The top 1 percent now owns 50.1 percent of the world's wealth, up from 45.5 percent in 2001."So far, the Trump presidency has seen businesses flourish and employment grow, though the ongoing supportive role played by the Federal Reserve has undoubtedly played a part here as well, and wealth inequality remains a prominent issue," said Michael O'Sullivan, chief investment officer for International Wealth Management at Credit Suisse. "Looking ahead, however, high market valuations and property prices may curb the pace of growth in future years."The world's millionaires are expected to do the best in the coming years. There are now 36 million millionaires in the world, and their numbers are expected to grow to 44 million by 2022.
Who owns the worlds half the wealth
There are many ways in which the distribution of wealth can be analyzed. One common-used example is to compare the amount of the wealth of individual at say 99 percentile relative to the wealth of the median (or 50th) percentile. This is P99/P50, which is one of the potential Kuznets ratios. Another common measure is the ratio of total amount of wealth in the hand of top say 1% of the wealth distribution over the total wealth in the economy. In many societies, the richest ten percent control more than half of the total wealth.
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.[10] A 2006 study found that the richest 2% own more than half of global household assets.[11]
A 2021 Oxfam report found that collectively, the 10 richest men in the world owned more than the combined wealth of the bottom 3.1 billion people, almost half of the entire world population. Their combined wealth doubled during the pandemic.[13][14][15]
According to PolitiFact, in 2011 the 400 wealthiest Americans "have more wealth than half of all Americans combined."[24][25][26][27] Inherited wealth may help explain why many Americans who have become rich may have had a "substantial head start".[28][29] In September 2012, according to the Institute for Policy Studies, "over 60 percent" of the Forbes richest 400 Americans "grew up in substantial privilege".[30]
The first necessary condition for the phenomenon of wealth concentration to occur is an unequal initial distribution of wealth. The distribution of wealth throughout the population is often closely approximated by a Pareto distribution, with tails which decay as a power-law in wealth. (See also: Distribution of wealth and Economic inequality). According to PolitiFact and others, the 400 wealthiest Americans had "more wealth than half of all Americans combined."[24][25][26][27] Inherited wealth may help explain why many Americans who have become rich may have had a "substantial head start".[28][29] In September 2012, according to the Institute for Policy Studies, "over 60 percent" of the Forbes richest 400 Americans "grew up in substantial privilege".[30]
Eight men own the same wealth as the 3.6 billion people who make up the poorest half of humanity, according to a new report published by Oxfam today ahead of the annual meeting of political and business leaders in Davos, Switzerland.
That means that the ultrawealthy have already reached a tipping point predicted by Oxfam earlier this year, when the charity forecast that the world's wealthiest 1 percent would control half the world's assets by 2016. It's no wonder American workers and policymakers are concerned about the trend: The wealthiest are thriving at a time when everyone else -- from the middle class on downward -- are making do with less each year.
With the richest 1 percent now owning half the world's assets, the rest of the income distribution isn't coming out ahead. The bottom 71 percent of the world's population controls just 3 percent of the globe's wealth, giving each person in that lowest level less than $10,000 per person in assets. The middle 21 percent own 12.5 percent of the world's wealth, or less than $100,000 per person.
The jump comes as governments around the world poured money into their economies to mitigate the economic pain created by pandemic shutdowns. But that money also boosted stock prices and real estate values, adding to the wealth of top-earning individuals.
The 85 richest people on Earth have the same amount of wealth as the bottom half of the population, according to a new report that highlights growing income inequality as political and business leaders gather for the annual World Economic Forum in Davos, Switzerland.
Those wealthy individuals are a small part of the richest 1% of the population, which combined owns about 46% of global wealth, according to the report from British humanitarian group Oxfam International.
Much of global wealth is concentrated in the biggest economies, with households in China and the U.S. combining to make up half of all personal wealth in the world. This differs slightly from using GDP as a measure, where the U.S. and China make up 24% and 19% of the world economy in nominal terms, respectively.
Ahead, meet 10 of those 26 people who have more wealth than half the world's population, per Forbes' Billionaire List. Note, however, that there are some discrepancies between this list and another prestigious wealth ranking, the Bloomberg Billionaires Index; Bloomberg lists Bill Gates as the world's richest man and omits its founder, Michael Bloomberg.
Wildly successful investor Warren Buffett is the CEO of Berkshire Hathaway, which owns over 60 companies, Business Insider previously reported. Although he still lives a somewhat modest lifestyle, he became a billionaire at age 32. In 2010, Buffett, alongside Bill Gates, created The Giving Pledge, promising to donate at least half of their fortunes to charities.
Households are the final owners of wealth. For households, real assets, mostly housing, make up almost half of net worth. Net financial assets, in roughly equal parts pension assets, deposits, and equity, make up the other half. Distribution of assets among households varies across countries. For instance, households in Australia, France, Germany, and Mexico hold buildings and land, while in the United States, equity and pensions make up most of household wealth. In Japan, deposits account for more than one-third of total household assets. Via those financial assets and real estate holdings, households in the ten countries control 95 percent of net worth, ranging from 64 percent of national net worth in Mexico to 135 percent in the United States.
The public sector, often seen as an enabler of wealth, owns mostly public buildings, infrastructure, land, and natural resources equal to about 90 percent of GDP, and in some countries also holds financial assets such as stakes in state-owned enterprises. On the liability side of the balance sheet, public debt in many countries exceeds the value of public real assets.
First, though, some definitions. Generally speaking, wealth is the value of everything a person or family owns, minus any debts. However, for purposes of studying the wealth distribution, economists define wealth in terms of marketable assets, such as real estate, stocks, and bonds, leaving aside consumer durables like cars and household items because they are not as readily converted into cash and are more valuable to their owners for use purposes than they are for resale (see Wolff, 2004, p. 4, for a full discussion of these issues). Once the value of all marketable assets is determined, then all debts, such as home mortgages and credit card debts, are subtracted, which yields a person's net worth. In addition, economists use the concept of financial wealth -- also referred to in this document as "non-home wealth" -- which is defined as net worth minus net equity in owner-occupied housing. As Wolff (2004, p. 5) explains, "Financial wealth is a more 'liquid' concept than marketable wealth, since one's home is difficult to convert into cash in the short term. It thus reflects the resources that may be immediately available for consumption or various forms of investments."
This document focuses on the "Top 1%" as a whole because that's been the traditional cut-off point for "the top" in academic studies, and because it's easy for us to keep in mind that we are talking about one in a hundred. But it is also important to realize that the lower half of that top 1% has far less than those in the top half; in fact, both wealth and income are super-concentrated in the top 0.1%, which is just one in a thousand. (To get an idea of the differences, take a look at an insider account by a long-time investment manager who works for the well-to-do and very rich. It nicely explains what the different levels have -- and how they got it. Also, David Cay Johnston (2011) has written a column about the differences among the top 1%, based on 2009 IRS information.) 2ff7e9595c
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