AN INSIGHT: Global Distribution Of Wealth

WARNING: The following text contains strong facts that may be harmful to persons of financially challenged backgrounds. Furthermore, this insight is not gossip but a well-researched report to share the latest developments in the distribution of global wealth. Read it at your own risk!!!

What is Global Wealth?

I assume that everyone knows that wealth in general, is the abundance of valuable financial assets or physical possessions convertible into transactable forms. It is that gap between two or more financially distinguished groups in terms of assets and net worth (assets minus debts). Global wealth on the other hand is the money and other assets that exist in all areas of the world considered together. It currently stands at over US$454 trillion as of February 13, 2024.

Global Wealth Distribution

The distribution of wealth is a comparison of the wealth of various members or groups in a society. It shows one aspect of economic inequality or economic heterogeneity. This evidence shows us that inequality in many countries is very high and, in many cases, has been on the rise. Global economic inequality is vast and compounded by overlapping inequalities in health, education, and many other dimensions.

Economic Inequality

The economic gap between the nation’s richest and the poorest citizens is typically referred to as income inequality. The overall incomes of the world’s richest and poorest countries offers broad hints about the level of development in those countries, whilst the level of income inequality in a given country helps indicate the quality of life for its average citizen. Income inequality impacts a nation both economically and politically, with effects that include political polarization, negative attitudes towards the wealthy, slower GDP growth, reduced income mobility, higher poverty rates, and greater household debt. On the other hand, extremely income inequality that is extremely low can sometimes indicate a lack of economic growth.

We statistically measure economic inequality in a population using the Gini coefficient. The coefficient developed by Italian statistician Corrado Gini in 1912, measures the dispersion of income or distribution of wealth among the members of a population. The Gini coefficient ranges from 0(0%) to 1(100%), with 0 representing perfect equality and 1 representing perfect inequality. For example, in a country where everyone has the same income, the Gini coefficient would be 0. However, if a single resident earned all of the income while everyone else earned nothing, the coefficient would be 1.

The Global Wealth Gap

This gave birth to what is known as the top 1%, the middle 7% and the bottom 92% or simply the haves or the have-nots. The top 1% own more wealth than the bottom 92%. An example is the U.S.A. where the 50 wealthiest Americans own more wealth than the bottom half of the American society (165 million people). In general, the highest wealth wrung controls about $210 trillion or 45.8% in wealth of the global total. Just 1.1% of the world population fall in this bracket with about 2,640 of them being billionaires and about 25 being from Africa. Those with $100000 to $1 million have the next greatest share at about 40% of net household wealth. The rest of the of the folk including you and me, fall under the 92% of those with assets amounting at less than $10000 or nothing at all!

‘Wherever there is great property there is great inequality. For one very rich man, there must be at least five hundred poor, the affluence of the few supposes the indigence of the many.’ ~ ADAM SMITH.

The Top 10 Richest Individuals of 2024

In a society and era fueled by ambition and a drive for entrepreneurship, there is a distinguished set of individuals that’s achieved unimaginable fortunes. These extraordinary leaders, who possess vision and innovation, have ascended to the highest echelons of success, elevating themselves to the exclusive ranks of the world’s wealthiest individuals. Their wealth is primarily concentrated in technology, finance, and retail industries. Most of these faculties are largely concentrated in developing countries. They mastered the psychology of poverty and manipulated it to bear fruits for their own good causes.

‘But the rate of profit…is naturally low in rich, and high in poor countries, and it is always highest in the countries which are going fastest to ruin.’ ~ ADAM SMITH.

I am pretty sure we all have heard that the infamous statement, ‘It is lonely at the top!’ This statement is often mistranslated or wrongly translated by assuming that once you join the 1% club you then have enough time to rest. Absolutely not! A study has shown that there is more competition amongst the fewer 1% than amongst the congested 99%. Amongst the 99% is a fight to rise, whilst amongst the 1% is a fierce fight to stay afloat. This is the primary reason why the top 10 list of the wealthiest persons is constantly changing.

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