Journal Article
Wealth and its Distribution in Germany, 1895-2021
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German history over the past 125 years has been turbulent. Marked by two world wars, revolutions and
major regime changes, as well as a hyperinflation and three currency reforms, expropriations and terri-
torial divisions, it provides unique insights into the role of country-specific shocks in shaping long-run
wealth dynamics. This paper presents the first comprehensive study of wealth and its distribution in
Germany since the 19th century. We combine tax and archival data, household surveys, historical na-
tional accounts, and rich lists to analyze the evolution of the German wealth distribution over the long
run. We show that the top 1% wealth share has fallen by half, from close to 50% in 1895 to 27% today.
Nearly all of this decline was the result of changes that occurred between 1914 and 1952. The interwar
period and the wealth taxation in the aftermath of World War II stand out as the great equalizers in 20th
century German history. After unification in 1990, two trends have left their mark on the German wealth
distribution. Households at the top made substantial capital gains from rising business wealth while the middle-class had large capital gains in the housing market. The wealth share of the bottom 50% halved since 1990. Our findings speak to the importance of historical shocks to the distribution and valuations of existing wealth in explaining the evolution of the wealth distribution over the long run.
