What does it mean to be rich? Some conceptual and empirical issues
| Published date | 01 March 2018 |
| Date | 01 March 2018 |
| DOI | http://doi.org/10.1177/1388262718760911 |
| Subject Matter | Articles |
Article
What does it mean to be rich?
Some conceptual and
empirical issues
Pierre Concialdi*
IRES (Institut de recherches e
´conomiques et sociales), Noisy-le-Grand, France
Abstract
Over the past decade, a growing literature has shed light on the rise of inequalities at the very top
of the income distribution. There is no doubt that such extreme inequalities do threaten social
cohesion and that some public policies are needed in order to tackle this issue. The design of these
policies requires setting some benchmarks that could serve, at least, as guidelines to promote
efforts towards the reduction of inequalities. In the same way that the fight against poverty can
usefully benefit from researchers’ efforts to define poverty, the fight against extreme inequalities
could also benefit from some definition of rich people. Nevertheless, very little attention has been
given to the definition of the rich in the academic literature. The purpose of the paper is to try to fill
this gap. It draws on previous definitions of an affluence line and proposes some estimates for three
countries (France, Ireland and the UK).
Keywords
Rich, poverty, affluence line, inequality, reference budgets
Introduction
Over the past two decades, there has been a growing literature on ‘top incomes’.
1
One of the main
findings of this research is that inequali ties have not only been rising quite sharply in man y
* This article was awarded the SAGE/FISS prize for the best, previously unpublished paper presented at the 2017 FISS
Conference held in Sigtuna, Sweden.
Corresponding author:
Pierre Concialdi, IRES (Institut de recherches e
´conomiques et sociales), 16 Boulevard du Mont d’Est, 93192 Noisy-le-Grand
Cedex, France.
E-mails: pierre.concialdi@gmail.com; pierre.concialdi@ires.fr
1. Piketty’s best seller Capital in the Twenty-First Century is probably the most prominent example of this literature.
European Journal of Social Security
2018, Vol. 20(1) 3–20
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countries, but also that the income surplus has been overwhelmingly captured by a very small
proportion of the population. This is notably the case in the USA.
This issue was exacerbated after the financial turmoil that took place in 2007-2008. The Occupy
movement and its famous slogan ‘We are the 99 per cent’ focused its criticism on the concentration
of economic wealth among the top 1 per cent of American people. In many European countries, the
majority of the population would probably express the same sentiments. The private debt of banks
and other financial institutions was largely converted into public debt that ordinary citizens had to
assume at the expense of their working and living conditions. The iss ue has attracted such a
growing concern that international institutions have devoted reports to this issue (Dabla-Norris,
Kochhar, Suphaphiphat, Ricka and Tsounta 2015; Kelley 2015, World Bank 2016). In the public
debate as well as in the economic literature, there is growing attention on ‘rich’ people.
Surprising as it may be, despite the growing interest in these extreme inequalities, very little
attention has been given to the definition of the rich in the academic literature. Whereas social
scientists have for long devoted a great deal of effort to defining poverty, this is not the case for rich
or wealthy people. The lack of such definition favors the anomie that affects our societies. We
know that there are more and more rich people and that they are probably getting richer, but we do
not know precisely where we stand and, more importantly, where we would possibly like to go.
This issue thus remains a black hole in public policy. One of the objectives of this paper is to try to
fill this gap and to propose a definition of ‘the rich’.
Nevertheless, as relevant as the concept may be, it would not be very useful for the design of any
public policy if it could not translate in some measure or indicator. This is, perhaps, the most
difficult task. This difficulty is not specific to this subject. For instance, although there is now some
agreement among social scientists about how we should conceptually and theoretically define
poverty, there is still much controversy about how we should empirically measure it in order to
set a poverty line. Another objective of this paper is to discuss this empirical issue and propose a
method for defining an affluence line
2
that could achieve, as will be argued, the greatest consensus
within society.
It is necessary to make clear that the focus here is on a rather narrow definition of rich people,
that is people who are rich in a material or economic sense: a dimension that could be broadly
defined in terms of the control people have over material resources. This is, of course, a necessary
condition for being part of the ‘club’ of the rich. Yet, as with poverty, richness is a multidimen-
sional phenomenon. Culture, social relations and symbolic power are also fundamental dimensions
that should be included in a comprehensive definition. Sociologists are well aware of this reality
and there is no doubt that most of them will be disappointed by such an economic definition.
3
Moreover, within this narrow definition of economic richness, we will not make any distinction
between the various forms of economic richness. For instance, we will not make any distinction
between work incomes and capital incomes. In other words, in this paper, we only consider the
quantitative dimension of economic richness, although this may be seen as a relatively unconvin-
cing approach to defining rich people. Finally, a more severe limitation of this paper is perhaps that
it does not take into account the distribution of wealth, except by the way of monetary income
flows that derive from capital.
2. Throughout this paper, we use the term ‘affluence line’ as most authors do when they discuss this issue.
3. Cf. the work of two French sociologists, Monique Pinc¸on-Charlot and Michel Pinc¸on. The research of these two scholars
is focused on the wealthiest families and the super-rich.
4European Journal of Social Security 20(1)
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