Understanding Wealth At A Micro Level
DefinitionWealth, in its most general sense, is the accumulated total of all useful financial assets or material possessions that may be converted to a more usable form for future transactions. This includes both the original root meaning held by the original Indo-European language root weal, which literally means “to make good.” In this sense, weal referred to wealth not only in material terms but also in spiritual terms, since money was seen as the root of all evil and the reason for wars. While this may be the most common definition of wealth today, it is important to note that this is not necessarily the only way to understand what wealth means.
The root sense of wealth as something that is “worth” has been central to the understanding of how the wealthy have managed to accumulate great fortunes over the centuries. As the United States economy has gained a foothold as the world’s largest and most powerful economy, the perception of wealth has become a much more abstract and relative concept. It has become something that is measured in terms of dollars or shares or other financial metrics that are largely determined by a company’s stock price or net worth. Although the dollar may still hold a place in the net worth equation, the perception of value has increasingly shifted away from the dollar, as evidenced by the fact that the world’s largest economy exhibits wealth gaps of more than 20 percent between the haves and the have-nots. While the gap is smaller than the gaps identified in any other country, it is a significant achievement to see the US come close to equaling the economic output of India, a nation with one of the fastest growing populations of people on earth.
The shift from relative to absolute wealth has become critical in a changing global economy. While absolute wealth is typically defined as having a material possession, wealth becomes a much more abstract standard as dematerialization occurs. In addition, the process of accrual has become more complicated. This has led to the growth of complex institutions for creating wealth through the creation of infrastructures such as patents, intellectual property, and infrastructure.
Accumulation within the last century has also become more complicated. The creation of new knowledge and technologies such as the electric automobile and other highly refined tools has resulted in massive wealth accumulation through the application of advanced technologies. Technological change has also opened the door to unprecedented levels of wealth creation through natural resource extraction and the processing of resources to create ethanol, natural gas, and other valuable commodities. However, the process of gathering these resources from the earth has become increasingly expensive and inefficient. As a result, accumulated wealth becomes increasingly depressed as natural resources continue to deplete.
The process of wealth accumulation has also become more stratified by geography. Whereas in earlier periods the middle class was thought of as possessing wealth that could be easily pooled and transferred, the recent trend has been towards specialization and investment. High-end professionals with access to special equipment have developed their own companies that provide goods and services beyond the reach of ordinary consumers. Wealthy individuals often seek to establish their own companies within the confines of existing industries to gain a competitive advantage. However, in doing so, they often destroy the environment that they originally created through their inventions. The main article will look at the process through which wealth is created and how it relates to the main article.
Although a great deal of effort has been put into the study of wealth accumulation over the last century, there is still very much that is unknown about the process. Understanding wealth at a macro level requires studying all the different sectors of our society and how they relate to the current wealth distribution. Wealth at a micro level can be examined in terms of the relationships between individuals who are considered to be among the wealthiest Americans. Understanding this information can provide insight into the types of investments that future generations will be able to count on.