Bank of Italy: The richest 5% of households own 46% of national wealth

According to the latest statistics on household wealth distribution released by the Bank of Italy recently, in terms of wealth concentration, Italy is lower than the European average, but the richest 5% of households have about 46% of net wealth, while the poorest 50% of households have less than 8% of net wealth. Compared with France, Germany and Spain, which are also in the euro zone, Italy's median net wealth declined significantly in the years after the debt crisis (2010-2016), and still failed to recover in the subsequent period (2017-2022).

·Poor people's houses and rich people's wallets

According to the analysis of the Italian Central Bank, the main "wealth" of Italian less wealthy families is their own real estate, while wealthy families have a more diversified asset allocation, including stocks, deposits and policy portfolios.

According to the Bank of Italy, half of the wealth of Italians comes from real estate, but the share of real estate in total assets varies greatly depending on household wealth. For families below the median wealth, housing accounts for about three quarters of the total wealth. For middle-class families, the proportion is slightly less than 70%, while for the richest families, the proportion drops to slightly more than one third. It should be noted that for the poorest families, savings are the only important component of financial wealth (17%). The Bank of Italy then stressed that the investment portfolio of the richest families was more diversified, with nearly one third of them consisting of production related venture capital (stocks, shares and physical assets used for production) and one fifth of funds and insurance related investments.

Finally, the experts compared the current data with the data collected after the financial crisis. In 2010, about half of the housing stock was held by middle-class families, and by 2022, the proportion had dropped to 45%, mainly benefiting the richest families. In addition, between 2010 and 2022, household savings increased by about 40%, especially for the richest families, whose share increased by 6 percentage points, reaching half of the total savings.

·Situation in other countries

According to the data of the European Central Bank, in the euro area, from 2016 to the second quarter of 2023, the share of net wealth held by the richest 5% of households in the distribution of net wealth declined slightly, but still exceeded 43%. At the same time, the median net wealth increased by about 40%, from about 150000 euros in 2018 to 170000 euros at present.

The net wealth of households in the euro area has increased significantly in the past five years (29%, about 13.7 trillion euros), while the wealth inequality has decreased slightly, partly because more than 60% of the population of homeowners benefited from the rise in house prices. During this period, their net wealth increased by 27%. At the same time, the net wealth of non homeowners accounting for 40% of the population increased by 17%, mainly due to the increase in deposits.

Data shows that in terms of wealth concentration, Italy is lower than the average level of the European Union, on the same level as France, and behind Germany, which is becoming the European country with the highest degree of net wealth inequality.

In addition, according to the 2023 Global Wealth Report, since the 2008 financial crisis, global private wealth in 2022 will decrease for the first time from the previous year, by about $11 trillion (- 2.4%, and the total private wealth at the end of 2022 will exceed $454 trillion). The report also said that the average wealth of each adult decreased by 3.6%.

Among the richest countries in the world, the United States ranks first. The richest 1% of American families own 31.7% of the national wealth. The second place is China. In these two countries, the concentration of "super rich" is very high worldwide.

The content is from the European Times

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