Wealth
Wealth is the abundance of valuable financial assets or physical possessions which can be converted into a form that can be used for transactions.
Net worth is defined as the current value of one's assets less liabilities (excluding the principal in trust accounts).
The United Nations definition of inclusive wealth is a monetary measure which includes the sum of natural, human, and physical assets.
Around 35,000 years ago Homo sapiens groups began to adopt a more settled lifestyle, as evidenced by cave drawings, burial sites, and decorative objects.
[10] Those who had gathered abundant burial-site tools, weapons, baskets, and food, were considered part of the wealthy.
A person considered wealthy, affluent, or rich is someone who has accumulated substantial wealth relative to others in their society or reference group.
[12] Wealth can be categorized into three principal categories: personal property, including homes or automobiles; monetary savings, such as the accumulation of past income; and the capital wealth of income producing assets, including real estate, stocks, bonds, and businesses.
Wealth has been defined as a collection of things limited in supply, transferable, and useful in satisfying human desires.
The term implies a social contract on establishing and maintaining ownership in relation to such items which can be invoked with little or no effort and expense on the part of the owner.
[citation needed] Adam Smith saw wealth creation as the combination of materials, labour, land, and technology.
Modern philosophers like Nietzsche criticized the fixation on measurable wealth: "Unsere 'Reichen' – das sind die Ärmsten!
")[23] In economics, wealth (in a commonly applied accounting sense, sometimes savings) is the net worth of a person, household, or nation – that is, the value of all assets owned net of all liabilities owed at a point in time.
What marks the income as a flow is its measurement per unit of time, such as the value of apples yielded from the orchard per year.
[27] Over the history, some of the key underlying factors in wealth creation and the measurement of the wealth include the scalable innovation and application of human knowledge in the form of institutional structure and political/ideological "superstructure", the scarce resources (both natural and man-made), and the saving of monetary assets.
An example of the latter is generational accounting of social security systems to include the present value projected future outlays considered to be liabilities.
[28] Macroeconomic questions include whether the issuance of government bonds affects investment and consumption through the wealth effect.
[29] Environmental assets are not usually counted in measuring wealth, in part due to the difficulty of valuation for a non-market good.
They earn a significant income and consume many things, typically limiting their savings and investments to retirement pensions and home ownership.
[33] Although precise data are not available, the total household wealth in the world, excluding the value of human capital, has been estimated at $418.3 trillion (US$418.3×1012) at the end of the year 2020.
[38] According to the Kuznets curve, inequality of wealth and income increases during the early phases of economic development, stabilizes and then becomes more equitable.
