Pareto lives!

The richest one per cent of the world's population owns 40 per cent of the total household wealth, while the bottom half of the world makes do with barely one per cent, according to a research report released Tuesday.

The study, which further underlined the continuing disparity between rich and poor, is by the Helsinki-based World Institute for Development Economics Research, part of the United Nations University

It took more than $500,000 US to be among the richest one per cent of adults in the world, according to the report. The richest 10 per cent of adults needed $61,000 US in assets.

In contrast, 50 per cent of adults owned barely one per cent of the household wealth.

Wealth was defined as the value of physical and financial assets minus debts. The study differentiates between wealth and income. The authors note that "many people in high-income countries — somewhat paradoxically — are among the poorest people in the world in terms of household wealth" because they have large debts.

The bulk of the wealthiest adults (almost 90 per cent) are concentrated in North America, Europe and Japan, the researchers said. For example, North America accounts for only six per cent of adults, but held 34 per cent of the globe's household wealth.

(The Pareto Principle was named after the Italian economist Vilfredo Pareto, who observed that 80% of income in Italy was received by 20% of the Italian population. The assumption is that most of the results in any situation are determined by a small number of causes.)