What is the difference between income and wealth inequality?

Wealth inequality is in the news, with our friends at IPPR pointing to just how 'unevenly divided' wealth is in the UK. The problem is huge: the top 10% of households are 875 times wealthier than those at the bottom. read more

A much more useful topic of discussion—one that does a far better job of getting to the heart of what we really mean when we talk about economic inequality—is wealth inequality. Income inequality only matters insofar as it effects wealth inequality, anyhow. read more

Wealth inequality is much more severe than income inequality. A tiny fraction of the population owns most of the UK’s pile of riches. In our recent work, we found that, between 2006-8 and 2012-14, the richest fifth of households gained almost 200 times as much in absolute wealth terms compared to the poorest fifth. read more

tl;dr: Wealth is what you currently own. Income is the wealth you receive over time in return for your work and investments. Income inequality is produced by differences in your investments and the value of your labor. Wealth inequality is produced by time (as with my parents), and by differences in income (as with my friends who went into law or medicine). read more