Global wealth became even more concentrated in the hands of the rich in 2016, according to Oxfam. Eight people now control as much wealth as the poorest half of the world’s population. EURACTIV France reports.
Inequality continued to grow in 2016, according to Oxfam’s annual report, An economy for the 99%. Published to coincide with the Davos economic forum, the report analyses the evolution and the causes of inequality in the world.
This year’s conclusion was much the same as it has been for several years: wealth is increasingly concentrated in the hands of the richest 1%, who are now better off than the rest of the world’s population combined.
Using data from Crédit Suisse, Oxfam estimated that the combined wealth of the poorest half of humanity, some 3.6 billion people, represents just 0.2% of the total global wealth, or $409bn.
This figure is based on the Forbes billionaires list, according to which the richest eight men in the world control $426bn between them.
“It is obscene that so much wealth is concentrated in the hands of such an infinitesimal minority when we know that one in ten people in the world lives on less than $2 per day. Inequality consigns millions of people to poverty, breaks down our societies and weakens democracy,” said Manon Aubry, a spokesperson for Oxfam France.
Concentration of wealth
The concentration of wealth has accelerated considerably in recent years: in its 2010 report, Oxfam estimated that the richest 388 people owned as much as the poorest half of the population combined. In 2011 it was 177 individuals, and in 2014, 80 individuals posesed as much as the poorest 50%.
But this apparent acceleration of impoverishment is “largely down to the availability of new sources of data from India and China”, Oxfam said.
Redistribution not working
But aside from statistical changes, the acceleration of the concentration of wealth is down to a number of very real factors, notably the transmission of property.
Together, the 1,810 millionaires in dollars listed by Forbes for 2016 own around $6,500bn, roughly as much as the poorest 70% of the world’s population combined. But around one-third of these billionaires inherited their fortunes.
Oxfam predicted that over the next 20 years, inheritance law will allow 500 of these billionaires to pass on more than $2,100bn to their descendants. That is more than the GDP of India, the world’s second most populous country.
Another factor in the concentration of wealth is the ineffectiveness of redistributive measures.
According to the report, the distribution of value created in economies is occurring increasingly in favour of shareholders and to the detriment of workers or producers.
For example, in the 1980s, cocoa producers received 16% of the sale value of a chocolate bar, compared to just 6% today.