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

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.