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1% of the population owns almost half of the world's wealth

by Mohamed EL DEIB 2 years ago in finance
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47 million millionaires (in dollars) own 44% of all global private wealth, according to Credit Suisse.

1% of the population owns almost half of the world's wealth

47 million millionaires (in dollars) own 44% of all global private wealth, according to Credit Suisse. Inequalities in wealth are decreasing, but the great fortunes remain overwhelmingly Western.

47 million people in the world have assets (real estate and financial assets) of at least one million dollars [ Net wealth (debts deducted) per adult. One million dollars is approximately 900,000 euros. ] according to estimates by Credit Suisse (2019 data). They represent barely 1% of the world's population and hold 44% of all the world's private wealth.

To belong to the top 10% of the world, you must have at least 100,000 dollars, or about 90,000 euros per person or 180,000 euros for a couple. A French couple who owns a home of around 70 m 2 in a city like Tours, and who has finished repaying their loans, are thus among the wealthiest 10% in the world. The 550 million adults concerned worldwide hold 83% of world heritage.

But the vast majority of the world's adult population (three billion people) owns less than 10,000 dollars (9,000 euros), or even much less. Taken together, 57% of the world's least endowed inhabitants hold less than 2% of the world's private wealth.

Global wealth inequalities fell slightly between 2000 and 2019. The share of world wealth held by the top 10% fell from 89% to 82% during this period, again according to estimates from the Swiss investment bank. The Gini index [ The Gini index is an indicator of inequalities that takes into account the distribution of wealth between individuals. The more equal the distribution, the closer the index is to zero. The more unequal it is, the closer it is to 1. See Global wealth databook 2019, Crédit Suisse, 2019. ] of wealth went from 0.919 to 0.885. Populations with wealth between 10,000 and 100,000 dollars are appearing in emerging countries.

Be careful though: over the past ten years, the share of world heritage owned by the wealthiest 1% has risen from 41.7% in 2008 to 45% in 2019. The great fortunes of the richest countries, favored in particular by stock market prices, have thus recovered much of the ground that they had lost between 2000 and 2008 [ The wealthiest 1% owned 46.9% of the world's wealth in 2000, according to Credit Suisse. ].

These data strike public opinion, but must be used with caution. First, because 10% of the world's population still survives on less than $ 1.90 per day (about $ 1.70). In addition, the portion of assets worth 0 to 10,000 dollars mixes populations whose situation is hardly comparable, the very poor and the more advantaged young people but in debt or who have not yet been able to save.

Then, the notion of net wealth (deducted debt) is open to criticism. The household that goes into debt to buy a house has zero net worth, no more than a homeless person. Finally, it should not be forgotten that Credit Suisse data is based on estimates, in particular for countries where the national statistical system is unreliable. Even with the greatest rigor in the calculations, the value of goods is difficult to compare on a global scale: a house in the suburbs of Paris and another located in Dakar can have the same surface area, the same equipment, in short, bring the same comfort to its inhabitants, but they are valued at market prices that really have nothing to do with each other.

Indicators of global wealth inequalities can only provide orders of magnitude. However, they bear witness to the extreme concentration of wealth in the hands of a tiny minority of the population. The emergence of the nouveau riche in the countries of the South should not make us forget that misery persists for hundreds of millions of people in emerging and developing countries. And that the accumulation of immense fortunes remains almost exclusively reserved for a handful of inhabitants of the rich countries of Europe and North America.


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Mohamed EL DEIB

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