Routes to the Top

Who makes it to the top? We use the leading, socio-economic survey in Germany supplemented by extensive data on the rich to answer this question. We identify the key predictors for belonging to the top 1 percent of income, wealth, and both distributions jointly. Although we consider many, only a few traits matter: Entrepreneurship and self-employment in conjunction with a sizable inheritance of company assets is the most important covariate combination across all rich groups. Our data suggest that all top 1 percent groups, but especially the joint top 1 percent, are predominantly populated by intergenerational entrepreneurs.

Keywords: Top wealth, top income, intergenerational transfers, rich-group classification modelling, predictions

JEL Classification: D31,C38,D63

Suggested Citation: Suggested Citation

König, Johannes and Schluter, Christian and Schröder, Carsten, Routes to the Top (December 2023). DIW Berlin Discussion Paper No. 2066, Available at SSRN: https://ssrn.com/abstract=4692506 or http://dx.doi.org/10.2139/ssrn.4692506