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About this dashboard

  • Title: Net wealth in Europe. New results from the Eurosystem
  • Number: 3/2020
  • Date: March 30, 2020
  • Author: HFCS Team, Oesterreichische Nationalbank (OeNB)
  • Data: Eurosystem HFCS 2017


What we do

  • This dashboard is part of our series of Household Finance and Consumption Survey (HFCS) dashboards.
  • Each dashboard is designed to provide concise information on a specific topic.
  • All information displayed - be it figures, tables or text - is based on HFCS data.


Who we are

  • We are the HFCS team of the Oesterreichische Nationalbank (OeNB).
  • As such, we are tasked with collecting and analyzing data on Austrian households’ finances and consumption.
  • For more information on the HFCS in Austria, visit our website for the HFCS Austria.
  • For general information on the Eurosystem’s HFCS, visit the website of the ECB’s Household Finance and Consumption Network (HFCN).


How to contact us

Find out more by clicking on the Question tab!

Question

Question

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Question

How does net wealth compare across countries and households in Europe?


Main definitions

Net wealth = real assets + financial assets - debt

  • Examples: Real assets include real estate, land or vehicles; financial assets include sight accounts, savings accounts, stocks or bonds; debts include mortgages, overdraft debt or credit card debt.

Income = combined annual income of all members of a household

  • Examples: Income includes gross labor income, non-labor income, public transfers or private transfers.

Quantiles = set of values of a variable which divides the frequency distribution of that variable into equal groups, each containing the same fraction of the total population.

  • Examples: Net wealth percentiles consist of a set of 99 values of net wealth dividing the net wealth distribution into 100 equal groups, income deciles consist of a set of 9 values of income dividing the income distribution into 10 equal groups.


Main background facts for the survey

  • Joint project of ECB and central banks of 22 European countries.
  • Detailed household-level data on household balance sheets and consumption behaviour.
  • The HFCS is conducted in a decentralised manner by each country’s central bank or statistical institute in some cases.
  • The third wave of the HFCS was conducted mainly in 2017.
  • The HFCS is designed around a common set of methodological principles to ensure harmonized datasets.
  • Household samples have been designed in each country to ensure representativity of each country’s household population.
  • For the HFCS, a state-of-the-art multiple stochastic imputation strategy has been chosen.
  • The countries participating in the HFCS 2017 Wave are
    • all euro area countries: Austria, Belgium, Cyprus, Germany, Estonia, Finland, France, Greece, Ireland, Italy, Lithuania, Luxembourg, Latvia, Malta, Netherlands, Portugal, Slovenia, Slovakia, Spain*;
    • and additionally: Croatia, Hungary and Poland.

For detailed information on the methodology, please refer for the Austrian HFCS to the methodological notes and the first results and for the Eurosystem HFCS to the methodological report and the results report.

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Countries participating in the HFCS 2017 Wave

*This dashboard does not include results for Spain, as the Spanish data were not available at the time of release. As soon as the Spanish data are available, we will update the dashboard in order to include results for Spain.

Find out more by clicking on the Answer tabs!

Answers

Answer

How much net wealth do different households have in different countries?

Source: Eurosystem HFCS 2017.

We first take a look at the distribution of net wealth in each country.

The table shows the distribution of net wealth across households for every country. Households are arranged according to their absolute net wealth (in EUR thd) from low (P1) to high (P99).

Dispersion is high in every country: households with very low and very high net wealth can be observed.

In Austria, approximately 50% of all households have a net wealth below 83,000 euros. Only 5% of all households have a net wealth above 866,000 euros. Some countries (e.g. Italy) have higher medians but comparatively lower wealth values at the right tail of the distribution.

Note that the table allows to sort the countries according to their net wealth value for each percentile.

How does inequality of net wealth compare across countries?

Source: Eurosystem HFCS 2017.

The table shows different measures of wealth inequality across countries.

According to the Gini coefficient, where a higher value expresses higher inequality, Austria belongs to the countries with the highest wealth inequality (0.73) together with the Netherlands (0.78), Cyprus (0.75) and Germany (0.74). This ranking changes when other inequality measures are used.

In all countries, households in the lower half of the distribution hold only a tiny fraction of aggregate wealth. The 50% poorest households hold less than between 15% of total net wealth in Slovakia and 0.5% in the Netherlands, while the 5% richest households hold more than between 27% of total net wealth in Greece and 49% in Cyprus.

The high inequality of the wealth distribution in Austria and Germany and the very small fraction of aggregate wealth held by households in the lower part of the wealth distribution in these two countries, reflect the fact that the well-developed welfare state in both countries offers many state-organized insurances against the contingencies of life as substitutes for private wealth (for a more detailed discussion see Fessler and Schürz (2018)).

How do income inequality and wealth inequality relate?

Source: Eurosystem HFCS 2017.

The graph shows the location of the countries according to the Gini coefficient of gross income and net wealth. Due to generally higher Gini of wealth than of income the range of the x-axis differs from the one of the y-axis.

Countries with low Gini of income and low Gini of wealth can be found in the lower left corner, those with high Gini of income and high Gini of wealth in the upper right corner of the graph.

There is no strong correlation between the Gini of income and the Gini of wealth.

On the one hand, there are several countries with high wealth inequality but low income inequality (e.g. Austria) or countries with low wealth inequality but high income inequality (e.g. Lithuania).

On the other hand, there are also countries with low wealth inequality and low income inequality (e.g. Slovakia), or countries with high wealth inequality and high income inequality (e.g. Estonia).

How much private wealth has been accumulated?