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Benjamin Braun
@benbraun.bsky.social
Political economist @ LSE | Finance, central banking & more | benjaminbraun.org
1.6k followers385 following118 posts
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I wrote a post about the ECB's new distributional wealth accounts, which are a big deal. It explains what DWA are and shows what researchers can do with them. Highlights: - very unequal distribution of shares & business assets - massive home-owner/tenant wealth gap 1/3 benjaminbraun.org/posts/dwa/

The most unequally distributed asset category are equity claims on businesses, which come in two forms. On the one hand, there is the DWA category “business wealth”, which includes unlisted shares (in unlisted corporations) and equity in non-corporate businesses. On the other hand, there are listed shares and investment fund shares, which are classified as financial wealth. Both are extremely unequally distributed. There are, however, interesting variations. Take the example of Germany, which is the country with the third least unequal distribution of business assets, while showing the second most unequal distribution of shares and investment fund shares.
As mentioned, the DWA allow two more breakdowns besides wealth groupings: by housing status (home owner - tenant) and by employment status (employed - self-employed - unemployed). Given the centrality of real estate in household wealth, we should expect home owners to be considerably richer than non-home owners. But how much richer exactly? The answer is somewhat shocking—the average home-owning household is about 5 to 12 times richer than the average tenant household. In the extreme case of Lithuania, the ratio is 16 times. With the exceptions of countries that have seen a sluggish recovery of house prices from post-2008 lows (Greece, Spain) or where house price growth has essentially been flat (Italy), the wealth gap between home owners and tenants has increased enormously across the board, in both Eastern and Western European countries.
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The big disappointment: The DWA do not allow for granular breakdowns at the top of the wealth distribution. The top wealth group is the top decile, or the richest 10 per cent of households, meaning we can learn next to nothing about what is going on at the very top. 2/3

Across all wealth deciles and countries, real estate is the dominant asset in household portfolios. However, in a society with a comparatively low home ownership rate such as Germany, real estate accounts for a much smaller share of household wealth in the lower wealth deciles. This difference disappears in the top wealth decile, where business and financial wealth become much more important, accounting for about half of the wealth of the richest 10%.
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Benjamin Braun
@benbraun.bsky.social
Political economist @ LSE | Finance, central banking & more | benjaminbraun.org
1.6k followers385 following118 posts
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