Wealth inequality in Eurozone has increased during the debt crisis

Wealth inequality in Eurozone

Wealth inequality in EurozoneThe concentration of wealth among the richest households in the Eurozone has increased since the debt crisis, although the levels of well-being as a whole fell due to lower housing prices, show the results of a study of the European Central Bank (ECB). The wealthiest 5% of households have 37.8% of net wealth in 2014, while in 2010 this share was 37.2%. Meanwhile, the poorest 5% in turn have only duties in 2014. The results are based on study of 84,000 Households.

After several waves of recession the Eurozone increase inequalities. For example countries in the periphery – such as Italy, Spain, Portugal and Greece had serious difficulties, while the inside countries of the monetary union have recovered faster. For example the median wealth in German, the bloc’s economic powerhouse, increased by 10% over the same period. It also edged up in Austria, Finland and Luxembourg.

The median household wealth of the Eurozone has fallen by about 10% to 104,100 EUR over the four years to 2014 because of the fall in property prices, especially for the poorest fifth of the population. To reach the top 10%, households needed to hold net wealth of 496,000 EUR or more, while the lowest 10% had 1,000 EUR or less.

“The decline in net wealth was mainly due to the decline in asset prices, especially real estate”, says the report of the European Central Bank (ECB). The experts added that the amendment is greater for poorer households.

The property price fall, a consequence of the bloc’s economic crunch, hurt the poorest the most – real estate wealth was down by a fifth for the poorest 40%, twice the rate of the drop affecting the richest 20%.

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