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> Fascinating chart: more than half of all private wealth has been inherited in Germany, UK, Switzerland, France — trend: rising fast! > Ever less private weal

> Fascinating chart: more than half of all private wealth has been inherited in Germany, UK, Switzerland, France — trend: rising fast! > Ever less private wealth is accumulated through own work, increasingly more through inheritance. A massive part of people's motivation to work is to provide for their children. That an increasing portion of wealth is inherited rather than build in an individual's working life-time is indicative that the system is function as intended. The graph seems to indicate there was a bit of a golden area after WWII up until the early nineteens, and that the nations included on the graph are returning the regular state of affairs. But what does any of this mean?

nickthemagicman 9y ago
As always it's about moderation. Saving wealth to take care of your children is one thing but this much seems excessive and ultimately means that inequality will continue to increase as wealth is trans-generationally hoarded. Massive inequality also portends social unrest, plagues due to people who can't afford medical care, wars, etc etc
zokier 9y ago
Modern inheritance should be inherently dissipative, as the estate is repeatedly divided among the heirs, amplified by death/inheritance/estate taxation. The problems arise when the wealth accumulation overpowers the dissipative effect of inheritance, combined with increasingly absurdly high wealth levels that go far beyond providing for children and grandchildren. As for the "golden area" you mentioned; yes, the war(s) did function as great equalizing wealth redistribution force. Arguably bit of a blunt instrument to accomplish that.
- humanrebar 9y ago
  Wealth naturally dissipates through the generations. What has changed the most is the birth rate of the wealthy. If they went back to having a dozen children apiece, wealth would dissipate at least an order of magnitude per generation.
  - ridgeguy 9y ago
    Depends on laws and customs. Primogeniture concentrates inherited wealth in firstborn (usually male) offspring. [1] [1] https://en.wikipedia.org/wiki/Primogeniture https://en.wikipedia.org/wiki/Primogeniture
    - goliatone 9y ago
      OT but I grew up in a place where first borns would inherit the land that was good for farming and other siblings would get the less desirable land, usually on the coast. Apparently it would make siblings tear each other apart because the difference in land had a huge impact on a family’s wellbeing. Eventually, with tourism, the value of land flipped, making families that owned land by the coast become wealthy. Talk about external factors affecting upward mobility.
    - deleted 9y ago
      [deleted]
- user5994461 9y ago
  Wars, sickness and starvation have been great equalizers. The last ones were decades ago and there is no sign of it coming back any time soon. We're living in unprecedented times.
  - jopsen 9y ago
    Or was it the social-democratic politics that follow war, sickness and starvation? Or if you're right-leaning maybe you would argue that it was the high growth that was a great equalizer. Or perhaps a mix of these. I don't see social-liberalism going away in Europe. And while growth might not be same as it used to be, technology is likely to keep disrupting established businesses.
- twblalock 9y ago
  Wealth grows fast enough due to investment that splitting it up between children won't dissipate it.
- nugget 9y ago
  Wouldn't the trend towards fewer children and smaller families decrease the dissipative effect? In the extreme case of a "one child" policy, inheritance would be amplified because the wealth of both parents (and presumably four sets of grandparents) would flow to a single individual. Similar to assortive mating, if wealthier families had fewer children relative to poorer families, then this would worsen inequality over time.
  - rabidrat 9y ago
    Often stated as "the rich get richer and the poor have children".
- jopsen 9y ago
  The War, maybe.. or perhaps the social-democratic policies that followed in many countries after the great depression and the war.
- lagadu 9y ago
  It helps that wealthier people have fewer children, so wealth dissipation affects poorer people dis-proportionally.
crdoconnor 9y ago
A massive part of people's motivation to work is to provide for their children. >That an increasing portion of wealth is inherited rather than build in an individual's working life-time is indicative that the system is function as intended. No, it just signals that the tax system treats unearned income and wealth more favourably than earned income. Political choices. How you feel about that depends upon how you feel about in increase in unearned income flowing to the wealthy I guess.
- julian_1 9y ago
  > the tax system treats unearned income and wealth more favourably than earned income. The income was taxed when it was earned. What reason is there to tax it twice? > how you feel about in increase in unearned income flowing to the wealthy I guess. Or about how you feel about the government's use of it's citizen's resources. Why should wealth earned by the breadwinner of the family, not remain with the family? It's arguably better than expropriating citizen's wealth to fund expaditionary warfare.
  - rtpg 9y ago
    Double taxation doesn't mean anything in this context. We tax transactions, not specific euros. Income tax when an employer pays their employee. Inheritance tax once the money goes from the deceased to the heirs. These are separate things! And no different than, say, VAT on that iPhone. Sure it's between family members , but in the vast majority of cases all parties are independent adults. The land you inherit is not "justly yours". It was the previous owner's thing. You are getting it but it is not your divine right, except that you won the birth lottery by being born into this family. Of course a lot of families also have smaller domains, and it makes since to have some lower limit... But let's not forget people affected by inheritance tax are overwhelmingly very rich. Most of the population ends up with nothing.
    - julian_1 9y ago
      > The land you inherit is not "justly yours". It was the previous owner's thing. You are getting it but it is not your divine right, except that you won the birth lottery by being born into this family. Of course those arguments apply to governments as well, since they don't derive their law-making authority by claim to divinity - at least in modern times. Why should a government be specially privileged over a citizens wishes to provide for their family and/or community after death?

nickthemagicman 9y ago

As always it's about moderation. Saving wealth to take care of your children is one thing but this much seems excessive and ultimately means that inequality will continue to increase as wealth is trans-generationally hoarded. Massive inequality also portends social unrest, plagues due to people who can't afford medical care, wars, etc etc

zokier 9y ago

Modern inheritance should be inherently dissipative, as the estate is repeatedly divided among the heirs, amplified by death/inheritance/estate taxation. The problems arise when the wealth accumulation overpowers the dissipative effect of inheritance, combined with increasingly absurdly high wealth levels that go far beyond providing for children and grandchildren. As for the "golden area" you mentioned; yes, the war(s) did function as great equalizing wealth redistribution force. Arguably bit of a blunt instrument to accomplish that.

humanrebar 9y ago
Wealth naturally dissipates through the generations. What has changed the most is the birth rate of the wealthy. If they went back to having a dozen children apiece, wealth would dissipate at least an order of magnitude per generation.
- ridgeguy 9y ago
  Depends on laws and customs. Primogeniture concentrates inherited wealth in firstborn (usually male) offspring. [1] [1] https://en.wikipedia.org/wiki/Primogeniture https://en.wikipedia.org/wiki/Primogeniture
  - goliatone 9y ago
    OT but I grew up in a place where first borns would inherit the land that was good for farming and other siblings would get the less desirable land, usually on the coast. Apparently it would make siblings tear each other apart because the difference in land had a huge impact on a family’s wellbeing. Eventually, with tourism, the value of land flipped, making families that owned land by the coast become wealthy. Talk about external factors affecting upward mobility.
  - deleted 9y ago
    [deleted]
user5994461 9y ago
Wars, sickness and starvation have been great equalizers. The last ones were decades ago and there is no sign of it coming back any time soon. We're living in unprecedented times.
- jopsen 9y ago
  Or was it the social-democratic politics that follow war, sickness and starvation? Or if you're right-leaning maybe you would argue that it was the high growth that was a great equalizer. Or perhaps a mix of these. I don't see social-liberalism going away in Europe. And while growth might not be same as it used to be, technology is likely to keep disrupting established businesses.
twblalock 9y ago
Wealth grows fast enough due to investment that splitting it up between children won't dissipate it.
nugget 9y ago
Wouldn't the trend towards fewer children and smaller families decrease the dissipative effect? In the extreme case of a "one child" policy, inheritance would be amplified because the wealth of both parents (and presumably four sets of grandparents) would flow to a single individual. Similar to assortive mating, if wealthier families had fewer children relative to poorer families, then this would worsen inequality over time.
- rabidrat 9y ago
  Often stated as "the rich get richer and the poor have children".
jopsen 9y ago
The War, maybe.. or perhaps the social-democratic policies that followed in many countries after the great depression and the war.
lagadu 9y ago
It helps that wealthier people have fewer children, so wealth dissipation affects poorer people dis-proportionally.

crdoconnor 9y ago

A massive part of people's motivation to work is to provide for their children. >That an increasing portion of wealth is inherited rather than build in an individual's working life-time is indicative that the system is function as intended. No, it just signals that the tax system treats unearned income and wealth more favourably than earned income. Political choices. How you feel about that depends upon how you feel about in increase in unearned income flowing to the wealthy I guess.

julian_1 9y ago
> the tax system treats unearned income and wealth more favourably than earned income. The income was taxed when it was earned. What reason is there to tax it twice? > how you feel about in increase in unearned income flowing to the wealthy I guess. Or about how you feel about the government's use of it's citizen's resources. Why should wealth earned by the breadwinner of the family, not remain with the family? It's arguably better than expropriating citizen's wealth to fund expaditionary warfare.
- rtpg 9y ago
  Double taxation doesn't mean anything in this context. We tax transactions, not specific euros. Income tax when an employer pays their employee. Inheritance tax once the money goes from the deceased to the heirs. These are separate things! And no different than, say, VAT on that iPhone. Sure it's between family members , but in the vast majority of cases all parties are independent adults. The land you inherit is not "justly yours". It was the previous owner's thing. You are getting it but it is not your divine right, except that you won the birth lottery by being born into this family. Of course a lot of families also have smaller domains, and it makes since to have some lower limit... But let's not forget people affected by inheritance tax are overwhelmingly very rich. Most of the population ends up with nothing.
  - julian_1 9y ago
    > The land you inherit is not "justly yours". It was the previous owner's thing. You are getting it but it is not your divine right, except that you won the birth lottery by being born into this family. Of course those arguments apply to governments as well, since they don't derive their law-making authority by claim to divinity - at least in modern times. Why should a government be specially privileged over a citizens wishes to provide for their family and/or community after death?