INEQUALITY | BASIC PAPERS
Perceived or Real - How Unequally Is Wealth Distributed in Germany? Taking Stock on the Basis of New Findings
by Xhulia Likaj and Thomas Fricke
BYFORUM NEW ECONOMY
PUBLISHED13. NOVEMBER 2023
Is wealth in Germany drifting apart? And has the gap reached proportions that are economically and socially problematic? These questions have been the subject of emotional debate in Germany for years. For a long time, there seemed to be no consensus, even among academics and scientists, on how unequal the situation is – and whether this should be considered a problem. The fact that the statements were sometimes very contradictory was also due to the fact that there were no official statistics on the subject in previous decades. In recent years, however, the data situation has improved significantly thanks to a steady stream of new estimates from researchers, and a consensus has increasingly formed among experts on the development and extent of inequality, as well as on the (most suitable) methods for measuring concentration. According to this, the concentration of wealth in Germany has risen sharply since 1990 and until recently and is very high by international standards. During this time, the richer half of the population has doubled its wealth, mainly thanks to rising capital gains and assets. In contrast, the already smaller share of total wealth held by the bottom 50 per cent has almost halved. The fact that wealth in Germany is therefore distributed more unevenly than the international average is true even taking into account special factors such as the existence of a state pension, which some consider to be a de-facto distribution of wealth. This paper is intended to provide an overview of the current state of research and empirical findings on the distribution of wealth in Germany.