ASSESSMENT OF WEALTH DIVERSITY (CASE OF LITHUANIA)

Abstract

The high level of income and wealth distribution in the world is recognized as a phenomenon that leads to negative economic and social consequences. The imperfection of redistribution levers in the economy has created conditions for the concentration of resources, material goods and wealth in small population groups. Today, the economic system is not focused on majority of the population, and therefore the high level of inequality and its consequences for economic growth, well-being and human development cannot be ignored. In this context, too high economic inequality in Lithuania is one of the most sensitive problems of the country; Lithuania is an anti-leader in the European Union according to economic inequality.Conventionally, economic inequality is measured using such methods as distribution of income and consumption of the population, however, to find out the real level of inequality, wealth diversity should be studied as well. The main purpose of this article is to identify and emphasise wealth diversity as an inseparable part of economic inequality in Lithuania and, as a result, the poor quality of life and obstacles in the way of economic progress as well as to compare wealth inequality with income inequality in Lithuania.The authors organised a representative poll of Lithuanian citizens and used a certain survey to collect information about the dwelling-places or other types of assets owned by the respondents as well as to evaluate wealth diversity in the country. The results show that the edge value of the assets owned by the representatives between I and X deciles differs by 16.9 times. However, comparing the average prices of dwelling-places in deciles I and X, the difference amounts to 7.2 times. Assessing all types of assets, including accommodation, land, durable goods, etc., it has been revealed that the distribution of wealth exceeds the limit of income and consumption distribution established by various statistical organisations and by the authors themselves. The decile ratio (in relation to deciles I and X) equals to 40.8, thus, it considerably exceeds the level of income and consumption inequality.