Wealth inequality within countries and regions
Thomas Piketty, a leading economist working on inequality, stresses the importance of wealth in analysing inequality. In his book “Capital in the Twenty-First Century” he explains that capitalism, left to itself, deepens economic inequality, as the rate of return of capital is usually greater than the rate of economic growth which leads to concentration of wealth. Analysing inequality historically as well as in several countries, he concludes that economic inequality has risen over the last decades in Western societies, which in turn has increased social and economic instability.
Wealth is in most cases distributed more unequally than income. Before World War I, 10% of the European population owned about 90% of wealth, primarily land and financial assets. These values declined until the 1970s, only to rise again thereafter. In the United States, China and Russia, the rise of wealth inequality in the recent decades has been even more dramatic than in Europe.
