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One thing that would interest me in these cross-country comparisons of private wealth is the degree to which the differences are accounted for by differences in home ownership patterns. In Ireland for example, home ownership is extremely high, resulting in both hish figures for private wealth and huge figures for private indebtedness.

This is mainly for historical reasons. There is a huge historic antipathy towards renting, because it was always about an Irish tenant class paying rents to a British landed gentry - even during the famine when most people were starving. Owning your own property, be in house or farm, became a key symbol of national and class independence from Britain and the British ruling class.

In more recent times the inadequacy of public pensions and the rapaciousness of the private pensions industry meant that a key way of providing for your old age was to own your own house/farm and perhaps one or two other properties as well from which you could draw a small "pension" or income.

My point is that all of this makes it look like Irish people are relatively wealthy when in fact they are heavily leveraged and reliant on property ownership to provide basic income security. In Germany, I suspect, by way of contrast, there is no comparable insecurity about the reliability and adequacy of public pensions/health provision and thus no need to build up a comparable equity base in property or other assets.

I would be interested in whether a similar phenomenon is at work in Mediterranean countries, and on whether anyone has any hard data on this.

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by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Mon Mar 18th, 2013 at 06:33:02 AM EST
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