Magazine

Where do the wealthiest 1% live?

  • 25 January 2015
  • From the section Magazine
Map showing where the wealthiest 1% live

As the business and political elite met at the World Economic Forum in Davos this week, there was much talk of rising inequality, and many references to the "wealthiest 1%". The phrase conjures up images of billionaires living on private islands - but is that who the 1% really are?

A report by the charity Oxfam released to coincide with the Davos gathering caused a stir by predicting that the wealthiest 1% will soon own more than the rest of the world's population.

It drew on research from the bank Credit Suisse, which estimated total global household wealth in 2014 at $263tn (£175tn).

That's wealth, not income. It is calculated as assets minus debt.

Obviously billionaires like Bill Gates, Warren Buffett and Mark Zuckerberg are part of the 1%. But who else is? According to Credit Suisse, another 47m adults - everyone with wealth of $798,000 (£530,000) or more.

That includes many people in rich countries who may not regard themselves as particularly wealthy, but who simply own their house outright or have paid off a significant chunk off their mortgage.

Among them are:

  • 18m people in the US - the country with more members of the 1% than any other
  • 3.5m people in France
  • 2.9m people in the UK
  • 2.8m in Germany

Germany has the biggest economy in Europe. The reason it has fewer wealthy people - by Credit Suisse's measure - is that it has lower levels of home ownership.

There are two Asian countries with more than a million people in the top 1%:

  • 4m in Japan
  • 1.6m in China

The country with the largest proportion of its population in the 1% per capita is Switzerland. One in 10 Swiss residents - 800,000 out of 8m - have assets worth more than $798,000.

But Credit Suisse's report doesn't tell the whole story.

It doesn't take into account how much it costs to buy goods in each country, for example. Half a million pounds might buy a one-bedroom flat in central London, but in other countries it could buy a mansion.

It also doesn't take into account income. As a result, many well-paid young people in Western countries may fall into the bottom 50% of wealth - either because they still have student debt to pay off, or because they know how to live well, and spend all their income.

If entry into the 1% does not guarantee a jet-set lifestyle, this is even truer when it comes to the cut-off point for the wealthiest 10% - for this you only need $77,000 (£50,000) of assets.

And the figure required to be in the top half of the world's wealthiest is just $3,650 (£2,400).

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