Americans still the wealthiest, but less so
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Kai Ryssdal: The gap between rich and poor countries is shrinking. A report out today says developing counties are getting richer and industrialized economies are going backward.
Marketplace’s Jeff Tyler reports.
Jeff Tyler: In industrialized countries, investors have watched stock portfolios hemorrhage as emerging economies have been picking up speed.
Michael Heise is chief economist with the German insurance company, Allianz. Its study looked at global financial wealth in terms of assets like stocks, bank accounts and insurance policies.
Michael Heise: In the emerging market world, there has been some growth of assets, even during the crisis.
Why have people in emerging economies done so well? One, they tend to save more than we do. And two, because they are very cautious investors — preferring savings accounts over mutual funds. All together, there are now about half a billion people on this planet who can be classified as middle class.
Heise: Half of them are located in emerging markets and also developing countries. That wealth is trickling down somewhat into the poorer parts of the world.
The middle class in developing countries might be larger by other measurements. Tim Smeeding is director of The Institute for Research on Poverty at the University of Wisconsin-Madison.
Tim Smeeding: One part of building wealth that may not be taken into account is the growth of home ownership and home quality in the developing world. People tend to create their own wealth, many of them by building their own homes.
But progress is relative. The wealth gap has shrunk by two-thirds in the last 10 years. Nonetheless, the average financial wealth in industrialized countries is still 50 times the average in the poorest countries.
I’m Jeff Tyler for Marketplace.
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