Unequal partners: A breakdown of how many hold how much of Canada’s wealth

TheGlobeandMail.com – Business Briefing
July 16, 2018.   

Inequality may be more extreme in the United States and other countries than it is here, but an OECD working paper sheds new light on wealth and income distribution in Canada.

The broad view shows that across the countries that make up the Organization for Economic Co-operation and Development, the top 10 per cent of households own 52 per cent of wealth. In terms of income, the top group accounts for 24 per cent.

On the lower rungs of the ladder, 60 per cent hold about 12 per cent of household wealth.

“In addition, some countries feature large shares of households with high levels of debt relative to both their incomes and the assets that they hold; this potentially exposes such households to significant risks in the event of changes in asset prices or falls of their income,” said Carlotta Balestra and Richard Tonkin of the OECD’s statistics and data directorate.

And, “more than one in three people are economically vulnerable, as they lack liquid financial assets to maintain a poverty-level living standard for at least three months.”

At the country level, here’s a look at the various groups at the top from Ms. Balestra and Mr. Tonkin, based on the latest numbers:

 

Source: OECD

 

And here’s what Ms. Balestra and Mr. Tonkin found among the less fortunate in 28 countries:

 

Source: OECD

 

Among their other findings:

Households at the bottom of the wealth ladder are more likely to suffer low incomes, and vice versa.

“However, this relationship is far from perfect,” Ms. Balestra and Mr. Tonkin said.

“Households in the bottom quintile of the wealth distribution are most likely to also have low incomes in Canada, Luxembourg, Austria and Belgium […] while the proportion of households in the top wealth quintile also having high incomes is highest in United States, France, Italy and Canada.”

But there are other countries where the connection is not as strong.

Also at play are inheritances.

“According to these data, members of one in three households have received some form of gift or bequest by the time they were interviewed, ranging from 25 per cent of households in Latvia and 26 per cent in Canada, to 43 per cent in France and 47 per cent in Finland,” Ms. Balestra and Mr. Tonkin said.

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