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The richest 10 percent control two-thirds of wealth in S. Korea: report

November 2, 2015

In comparison, the lower half only accounted for 2 percent of the country’s assets

SEOUL/SEJONG (Yonhap) – The top 10 percent of South Koreans control 66 percent of the country’s wealth, with the inequality gap becoming more acute over time, a recent report showed.

According to the report by Kim Nak-nyeon, an economics professor at Seoul’s Dongguk University, Asia’s fourth-largest economy is encumbered by a sizable difference in wealth between the haves and have-nots.

While the rich monopolized wealth that includes both financial and property holdings, the lower 50 percent only accounted for 2 percent of the country’s assets.

The scholar, who based his findings on public data released by the National Tax Service from 2000 through 2013, said the size of wealth controlled by the top 10 percent started growing in the 2000-2007 period, before the global financial crisis, with the average wealth held totaling 624 million won (US$544,500).

Before the crisis, the country’s wealthiest people controlled 63 percent of all private assets.

The latest findings also showed that the “super rich,” or those in the top 0.5 percent, held average assets of 3.65 billion won.

In contrast to the concentration of wealth at the top, the bottom 50 percent have been losing ground. In 2000, they accounted for 2.6 percent of all private assets, with numbers falling to 2.2 percent in 2006.

The report painted a grimmer picture of the wealth disparity than those published by the Organization for Economic Cooperation and Development (OECD) that said the top 10 percent of South Koreans held half of the country’s assets.

The professor argued that the difference between his report and those by the Paris-based organization stems from how the data was collected.

The OECD gets its information from the household financial welfare survey compiled by Statistics Korea that may not fully reflect wealth levels of the rich. This is because the rich usually do not like to disclose their various holdings.

Based on the data collected, Kim said South Korea’s wealth inequality is not as bad as in the United States and Britain but falls short of France and other Western European countries.