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How is the Wealth of the United States distributed?

The wealth and income distributions have become much more skewed since this was written.

The wealth distribution in the United States, is similar to that of all nations of the world. Recently it has been claimed to be more skewed than most -- the wealthy are wealthier and the poor poorer. Perhaps so; comparisons are difficult.

The graphs shown here are approximate and rounded off for each presentation. Accurate data on the possession of wealth is difficult to acquire but what is used here and the graphs derived are a reasonable representation.

The purpose of examining these graphs is to create in our mind a picture of the wealth circumstances of the people of the United States.

What we can see in Figure 1" below is that a simple plot shows three distinct regions. The plot is linear, that is to say, the X and Y coordinates are simple rulers; no tricks. On this graph most of the people are represented by a very flat triangle at the bottom, too little money to show. And the wealthiest people are too few in number to show. They are a very flat vertical triangle. At the elbow there are another group of people barely visible on this graph.

The advantage of linear graphs like these is that the area under the curve represents the total amount of money in possession of these people.

The three groups have been defined both by "eye-balling" the graphs, it looks reasonable, and by adjusting their borders so that the groups divide the total net worth roughly equally. There is no special reason for doing this except as an aid in mentally visualizing the state of the wealth distribution.

One could divide the population into only two groups, but this would create a problem for all the people who want to think of themselves as being "middle class." And the "elbow" does have about the same total wealth as do each of the two "thin triangle" groups. fig1.gif

To show the wealth of the bottom 90 percent of the people, we must expand the Y units. The maximum net worth per person just exceeds $10,000. Of course, there are many people at the bottom whose net worth is less than zero -- not show here. fig2.gif

The middle 9 and one-half percent group has a range of net worth from more than $10,000 to more than $500,000. No doubt much of this consists of home ownership. fig3.gif

Finally, the wealthiest group, whose top goes off the graph at perhaps one billion dollars. Only one-half of one percent of the people fall into this group, but they do not lack for money. They could pay off the national debt and still be very wealthy, perhaps one-half as wealthy as they are now. NOTE: This comment stems from a study I made before the Reagan era of debt expansion. I will need to re-examine it -- or you may. I will expand this paragraph as soon as possible. fig4.gif

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