I was having a look at the number of millionaires living in each country around the world. Ireland ranks high by global standards at 178,000. The Netherlands, UK, Denmark, Sweden, and Switzerland are also high in Europe. However, when the UK is broken down Scotland and Northern Ireland don't rank anywhere near the top. I was wondering if you think this is a good indicator of a countries wealth?
like most economic questions, yes and no.....
we generally store wealth in the form of assets and their overall value, such as property, ireland has had a very laissez faire approach in regards attracting wealth into the country, but you may find many of these wealthy individuals may not actually live here much, if at all, i.e. but utilize our polices, and effectively use our system, in order to benefit from a reduction in taxes needed to be paid on their wealth, and ultimately the value of their assets.....
...for example, one of 'irelands richest'
....its a complicated question tbh....
Depends on how you define wealth, I guess.
A country with a lot of millionaires could also have massively inequality, meaning most of the country is poor and/or underdeveloped.
You could count the number of Ferrari's in a country as a measure of wealth, but if there's no roads for them to drive on, does it mean the country is wealthy?
What if it's a western country with very few millionaires? What does that say? The most recent data I can find on Scotland for example is from 2017. They only have 30,000 millionaires in the country.
This is down from 48,000 in 2015.
When you compare this to Ireland and Europe, it's pathetic.
Thanks for making my point.
A Country's Wealth is in it's people. Ireland tops the world.
I don't think anybody comparing the prosperity of national economies uses "number of millionaires living in the country" as a metric. And there are good reasons for that.
The first is that "millionaire" is a fairly elastic concept. Are you talking about people with earnings/income in excess of a million, or who own assets worth in excess of a million? If assets, are you talking about net assets or gross assets? (I.e. if I own a house worth 1.5 million with a mortgage of 600k, am I a millionaire?) And, a million what? Units of local currency? US dollars? Something else? All that needs to be sorted.
The answers make a difference. If you're looking at assets, the number of millionaires in a country is likely to be hugely affected by movements in residential property prices - both of the reports linked to earlier in the thread are basically about property prices. But a country's residential property market is just a small part of its overall economy. Similarly foreign exchange movements which affect the number of millionaires measured in, say, US dollars, don't map onto changes in the overall value of the economy.
The second issue, as already pointed out, is that the number of millionaires is hugely affected by income/wealth inequality, which varies greatly from country to country.
The third point is that the very wealthy, by definition, are pretty marginal. Their circumstances are not typical of the population as a whole, and you won't learn much about a country by looking just at its millionaires.
So, no. Whatever else it may measure, "number of millionaires" is basically useless even as a back-of-the-envelope indicator of national wealth, and nobody uses it.
I am talking about Credit Suisses definiton of a millionaire. They use the same criteria for defining a millionaire in every country. They use the USD. This is reported in the Global Wealth Databook.
It's still far from a reliable means of measuring, or comparing, a nation's wealth. In fact it's possibly one of the most idiotic ways of doing so.
And does the Credit Suisse report suggest that number of millionaires is a useful metric for comparing the prosperity of different countries?
No it doesn't. But it doesn't say that it isn't either.
The issues Peregrinus raised were not with whether a consistent definition of a millionaire existed. Say the EUR/USD rate changes substantially next week, resulting in a drop in the number of Irish "Credit Suisse millionaires". Is Ireland suddenly a less wealthy nation? What if a nation has 10% of its population as millionaires, giving it a very high per-capita count of millionaires, but the other 90% of the country live in abject poverty, is that a wealthy nation? The Credit Suisse definition is "the marketable value of financial assets plus non-financial assets (principally housing and land) less debts": so in a country like Ireland, where property values have dramatically shot up, we suddenly have huge numbers of "Credit Suisse millionaires". Does that make us a wealthier nation than one with a... saner... asset market? I don't think so. Those, and numerous other reasons, are why nobody uses "count of millionaires" as a metric for the wealth of a nation
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That's comical. There are many things it doesn't say.
The number of millionaires is not a measure of the wealth of a state/country/nation.
Get that notion out of your head.