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Capitalization of the World: Global Distribution of Income from Property, 2000–2020

Author

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  • Milanovic, Branko
  • Ranaldi, Marco

Abstract

Global capital income inequality has declined in the 21st century, with the Gini coefficient falling from 97% to 94%. Over the same period, the share of the world population with annual capital income above $100 increased from 12% to 27%. This implies more than a doubling of the number of individuals earning positive income from interest, dividends, rents, and privately-funded pensions. Most Western nations have lost positions in the global capital income ranking, in contrast to several developing countries, particularly China and Russia. When adjusting for missing capital income in surveys using national accounts, while the levels of inequality slightly vary across adjustment methods, the results consistently confirm a decreasing inequality trend. This is also confirmed when the capitalized wealth of billionaires is included in the analysis using Forbes lists. Overall, this paper provides new global evidence on the evolution, distribution, and measurement of capital income, and highlights its implications for inequality analysis in contemporary capitalism. (Stone Center on Socio-Economic Inequality Working Paper)

Suggested Citation

  • Milanovic, Branko & Ranaldi, Marco, 2026. "Capitalization of the World: Global Distribution of Income from Property, 2000–2020," SocArXiv swf8y_v1, Center for Open Science.
    • Handle: RePEc:osf:socarx:swf8y_v1
    DOI: 10.31219/osf.io/swf8y_v1
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    References listed on IDEAS

    as
    1. Maura Francese & Mr. Carlos Mulas-Granados, 2015. "Functional Income Distribution and Its Role in Explaining Inequality," IMF Working Papers 2015/244, International Monetary Fund.
    2. repec:osf:socarx:75ghp_v2 is not listed on IDEAS
    3. Ranaldi, Marco & Milanović, Branko, 2022. "Capitalist systems and income inequality," Journal of Comparative Economics, Elsevier, vol. 50(1), pages 20-32.
    4. Ranaldi, Marco, 2021. "Global Distributions of Capital and Labor Incomes: Capitalization of the Global Middle Class," SocArXiv 3g59r, Center for Open Science.
    5. Marco Ranaldi, 2022. "Income Composition Inequality," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 68(1), pages 139-160, March.
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    More about this item

    JEL classification:

    • D30 - Microeconomics - - Distribution - - - General
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution

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