Leaders Wealth versus work.
The new inheritocracy.
Inheriting is becoming nearly as important as working.
That is dangerous for capitalism and society.
Work hard, children are told, and you will succeed.
In recent decades this advice served the talented and the diligent well.
Many have made their own fortunes and live comfortably, regardless of how much money they inherited.
Now, however,
the importance of hereditary wealth is rising around the rich world and that is a problem.
People in advanced economies stand to inherit around 6 trillion dollars this year, about 10% of GDP,
up from around 5% on average in a selection of rich countries during the middle of the 20th century.
As a share of output,
annual inheritance flows have doubled in France
since the 1960s and nearly trebled in Germany since the 1970s.
Whether a young person can afford to buy a house and live in relative comfort is determined by inherited wealth nearly as much
as it is by their own success at work.
This shift has alarming economic and social consequences
because it imperils not just the meritocratic ideal but capitalism itself.
In part, the inheritance boom is a reflection of a wealthier and aging society.
As economies have become richer, they have accumulated capital per worker,