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Millionaires under the Microscope: Data Gap on Top Wealth Holders Closed: Wealth Concentration Higher than Presumed

Author

Listed:
  • Carsten Schröder
  • Charlotte Bartels
  • Konstantin Göbler
  • Markus M. Grabka
  • Johannes König

Abstract

Individuals with assets in the millions of euros have been underrepresented in population surveys and accordingly little has been known about them. As a result, the full extent of wealth concentration in Germany was unknown. To close the existing data gap, the Socio-Economic Panel (SOEP) integrated a special sample in which individuals with high assets are overrepresented. New calculations using this data and a national rich list show that the concentration of individual net assets in Germany is higher than previously thought. The top ten percent possess over two thirds of all individual net assets, while previously it was thought to only be 59 percent. The richest percent of the population has around 35 percent of the wealth, not 22 percent as previously thought. Around 1.5 percent of adults in Germany have assets in the amount of at least one million euros. These individuals do not only differ from the rest of the population in terms of wealth: They are also more often older men, more highly educated, self-employed, and more satisfied with their lives. The government could encourage wealth accumulation in the lower half of the distribution in various ways, such as in the form of individual savings accounts into which the state also pays.

Suggested Citation

  • Carsten Schröder & Charlotte Bartels & Konstantin Göbler & Markus M. Grabka & Johannes König, 2020. "Millionaires under the Microscope: Data Gap on Top Wealth Holders Closed: Wealth Concentration Higher than Presumed," DIW Weekly Report, DIW Berlin, German Institute for Economic Research, vol. 10(30/31), pages 313-322.
    • Handle: RePEc:diw:diwdwr:dwr10-30-1
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    Citations

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    Cited by:

    1. Jakob Kapeller & Anna Hornykewycz & Jan David Weber & Lukas Cserjan, 2024. "Dekarbonisierung des Gebaeudesektors als Teil einer sozial-oekologischen Transformation: ein Gestaltungsvorschlag," ICAE Working Papers 156, Johannes Kepler University, Institute for Comprehensive Analysis of the Economy.
    2. Bartels, Charlotte & Bönke, Timm & Glaubitz, Rick & Grabka, Markus M. & Schröder, Carsten, 2023. "Accounting for pension wealth, the missing rich and under-coverage: A comprehensive wealth distribution for Germany," Economics Letters, Elsevier, vol. 231(C).
    3. Kapeller, Jakob & Leitch, Stuart & Wildauer, Rafael, 2021. "A European wealth tax for a fair and green recovery," Greenwich Papers in Political Economy 31926, University of Greenwich, Greenwich Political Economy Research Centre.
    4. Kapeller, Jakob & Leitch, Stuart & Wildauer, Rafael, 2023. "Can a European wealth tax close the green investment gap?," Ecological Economics, Elsevier, vol. 209(C).
    5. Bellani, Luna & Berriochoa, Kattalina & Kapteina, Mark & Schwerdt, Guido, 2024. "Information Provision and Support for Inheritance Taxation: Evidence from a Representative Survey Experiment in Germany," IZA Discussion Papers 17099, Institute of Labor Economics (IZA).
    6. Wildauer, Rafael & Kapeller, Jakob, 2022. "Tracing the invisible rich: A new approach to modelling Pareto tails in survey data," Labour Economics, Elsevier, vol. 75(C).
    7. Kapeller, Jakob & Leitch, Stuart & Wildauer, Rafael, 2021. "A European wealth tax for a fair and green recovery," Greenwich Papers in Political Economy 31442, University of Greenwich, Greenwich Political Economy Research Centre.

    More about this item

    Keywords

    top wealth; wealth; asset portfolio; oversampling; SOEP;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • C83 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Survey Methods; Sampling Methods

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