Social Research Glossary
Citation reference: Harvey, L., 2012-17, Social Research Glossary, Quality Research International, http://www.qualityresearchinternational.com/socialresearch/
This is a dynamic glossary and the author would welcome any e-mail suggestions for additions or amendments. Page updated 2 January, 2017 , © Lee Harvey 2012–2017.
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Wealth is the accumulation of money, property and capital by an individual, organisation or country.
Wealth includes all assets as well as money held by an entity.
Investopedia (2013) defines wealth as:
A measure of the value of all of the assets of worth owned by a person, community, company or country. Wealth is the found by taking the total market value of all the physical and intangible assets of the entity and then subtracting all debts.
The Guardian (2013) reported:
Total household wealth in the UK has soared past the £7tn mark for the first time, research has found.
Net wealth, which includes the value of residential buildings and financial assets held by households, minus outstanding debts, has been estimated at £7.05tn for the end of 2012.
Lloyds TSB Private Banking, which carried out the research,...said a rise in financial assets had boosted the increase in household wealth over the past decade, contributing £1.7tn to the overall rise.
Financial assets include bank and building society deposits, government bonds, shares in listed companies, life assurance and pensions.
Domhoff (2013) wrote:
Generally speaking, wealth is the value of everything a person or family owns, minus any debts. However, for purposes of studying the wealth distribution, economists define wealth in terms of marketable assets, such as real estate, stocks, and bonds, leaving aside consumer durables like cars and household items because they are not as readily converted into cash and are more valuable to their owners for use purposes than they are for resale (see Wolff, 2004, p. 4, for a full discussion of these issues). Once the value of all marketable assets is determined, then all debts, such as home mortgages and credit card debts, are subtracted, which yields a person's net worth. In addition, economists use the concept of financial wealth -- also referred to in this document as "non-home wealth" -- which is defined as net worth minus net equity in owner-occupied housing. As Wolff (2004, p. 5) explains, "Financial wealth is a more 'liquid' concept than marketable wealth, since one's home is difficult to convert into cash in the short term. It thus reflects the resources that may be immediately available for consumption or various forms of investments."
We also need to distinguish wealth from income. Income is what people earn from work, but also from dividends, interest, and any rents or royalties that are paid to them on properties they own. In theory, those who own a great deal of wealth may or may not have high incomes, depending on the returns they receive from their wealth, but in reality those at the very top of the wealth distribution usually have the most income. (But it's important to note that for the rich, most of that income does not come from "working": in 2008, only 19% of the income reported by the 13,480 individuals or families making over $10 million came from wages and salaries. See Norris, 2010, for more details.)
Domhoff, G.W., 2013, 'Wealth, Income, and Power', updated February 2013, available at http://www2.ucsc.edu/whorulesamerica/power/wealth.html, accessed 13 May 2013, still available 29 December 2016.
Guardian, 2013, 'UK household wealth tops £7 trillion for the first time', The Guardian, 8 April 2013, available at http://www.guardian.co.uk/money/2013/apr/08/household-wealth-tops-7-trillion, accessed 13 May 2013, still available 29 December 2016.
Investopedia, 2013, 'Definition of 'Wealth'', available at http://www.investopedia.com/terms/w/wealth.asp, accessed 13 May 2013, still available 29 December 2016.
Norris, F., 2010, 'Off the Charts: In '08 Downturn, Some Managed to Eke Out Millions', 24 July 2010, New York Times, p. B-3.
Wolff, E.N., 2004, 'Changes in household wealth in the 1980s and 1990s in the U.S.', Working Paper No. 407. Annandale-on-Hudson, NY: The Levy Economics Institute of Bard College.
copyright Lee Harvey 2012–2017
copyright Lee Harvey 2012–2017