Wealth : Ownership & Distribution

Last few weeks saw media reports from Oxfam / New World Wealth , re: ownership of world’s wealth among its population

From reports published in Times of India / Business Line / DNA , I tried to piece together , following figures for India

INDIA POPULATION ( 2016 ) :

·         100  %   ………………………………………. 1324  million

·              1  %  …………………………………………..  13  million ( rounded off )

·            99  %  …………………………………………. 1311  million

INDIA TOTAL  WEALTH :

·         2016  …………………………………………..   $   6,600  Billion

·         2017  …………………………………………..   $   8,230  Billion ( $  8,230,000  million  )

2016  SCENARIO  :

Finding :  India’s  1 %  of persons held its 58 % of wealth ( in 2016 )

Implying :

·         13 million Indians ( 1 % ) ,  held $ 3,828  Billion = $ 3,828,000 million ( 58 % )  of wealth

·         So , each of these Indian held  $ 294,000  of wealth !

·         Balance 99 % of Indian held 42 % of the wealth

·         So, 1311 million Indian held $ 2,772 Billion = $ 2,772,000 million  of the wealth

·         So, each of those poor Indians held $ 2082  worth of wealth  !

WHAT  IF  ALL THE  WEALTH  WAS  EQUALLY  DISTRIBUTED AMONG  ALL ?

·         $ 6,600,000 Million to be distributed equally among 1324 million Indians

·         That would give each Indian , $ 4,985  worth of wealth

·         So each of these poor Indian would get transferred into his account, some $ 2900 ( Rs 1,88,500 ) from those rich Indians ( ie : Rs 15,708 per month for next 12 months )

WEALTH  CORNERED  DURING  2016-17

Finding :

·         Wealth generated during 2016-17

     $ 1.63 Trillion ( $ 8.23 Trillion  -  $  6.6 Trillion ) = $ 1,630 Billion = $ 1,630,000

     Million

·         73 % of generated wealth ( = $ 1.19 Trillion = $ 1,190 Billion = $ 1,190,000 Million ) cornered by 1 % of population ( ie : by 13 million Indians )

·         So , each of those 13 million rich Indians,  “ cornered “, $  91,538 of the Wealth generated

·         Balance 27 % of the wealth ( = 27 % of $ 1.63 Trillion = $ 0.44 Trillion = $ 440 Billion = $ 440,000 million ) , went to 1311 million Indians

·         So , each of those poor Indian managed to “ corner “ , $ 335 worth of wealth

QUESTIONS :

·         Can there be a somewhat better ( less unequal ) distribution of wealth cornered by the rich 1 % of the Indians by taxing them more ( than at present ) ?

·         How much more can we think of taxing the rich , with the sole purpose of obtaining a better distribution of wealth ?

·         If we agree that no amount of additional taxing of the rich , can bring about rationalization of wealth distribution , then what “ other  purpose “ can taxing of the super-rich , serve ?

·         Could that purpose be “ raising of resources “ for Infrastructure building ?

·         If so , how much resources can be raised ( for this Infrastructure Building purpose ) , by how much extra tax on the rich ?

·         If this ( additional tax on the rich ) ,  is unlikely to serve this other purpose , what else can we do to raise resources ( for Infrastructure Spending ) ?

I hope some Economic Experts will come up with an explanation of which “ purpose “ has 2018 tax proposals have managed to address

03  Feb  2018

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