The global concentration of wealth

What is it about?

This paper compares changes in relative and absolute wealth concentrations to establish if both processes have followed similar trajectories. The findings indicate that while the relative wealth concentration level has increased in recent times, it is not extraordinarily high from a historical perspective. In contrast, the absolute wealth concentration level is most likely higher than has ever previously occurred, because (i) the global population of high net worth individuals (HNWIs) and their mean wealth per capita have increased significantly, and (ii) the richest among these individuals are much richer than their counterparts in earlier times.

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Why is it important?

Recent works suggest that an on-going concentration of wealth holdings is not sustainable insofar as it poses a threat to financial stability and economic growth. Moreover, an increase in absolute wealth concentrations augments the potential lobbying power of the elites and therefore is likely to influence democratic decision processes.