IMF’s economic sustainability analyses fail to consider extreme wealth as macro-risk and address harms
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Article summary
- New Economics Foundation research demonstrates harmful consequences of extreme levels of capital accumulation and concentration of wealth at domestic and global levels.
- IMF surveillance should analyse the consequences of extreme wealth in order to address risks including rising inequality.
The IMF’s ongoing Comprehensive Surveillance Review (see Dispatch Annuals 2025; Observer Summer 2025) seeks to assess how the institution has dealt with questions of economic sustainability and risk in the advice it has presented to its member states particularly through bilateral (IMF to country) Article IV surveillance – yearly reports on a country’s economic status (see Inside the Institutions, IMF Surveillance).
However, an issue that the Fund has so far not included in its analyses is extreme wealth. Extreme levels of accumulation and concentration of wealth underlie the economic instability many countries are facing, which is manifested through increasing global economic volatility. A June report by Oxfam, for example, revealed that in 2025 over half the world’s population (3.7 billion people) live in poverty while the richest one per cent have gained $33.9 trillion of wealth in real terms over the past 15 years. As argued in an October Civil Society Policy Forum (CSPF) session during the World Bank and IMF Annual Meetings (see Dispatch Annuals 2025), inequality and extreme wealth drive real economic harms such as inflation, housing unaffordability and homelessness, and enables political control by unelected elites, weakening democratic institutions through political donations, lobbying and media capture. A September 2024 report by the Good Ancestor Movement and Patriotic Millionaires stated, “Not only does extreme wealth not lift others up, it poses significant risks to the economy through disproportionately concentrating power, destabilising and distorting market dynamics, and stagnating growth.”
Extreme wealth in Fund surveillance
Fund surveillance reports base their analysis of a country’s economic health on its overall economic stability and growth measured in GDP terms. However, GDP as a metric is blind to the harmful ecological and human effects of growth by any means, and is demonstrably insufficient for identifying economic risk factors associated with rising inequality. These can be revealed by including data on an extreme wealth line, a point at which wealth becomes so concentrated that it presents a risk both domestically and globally – from treating health and education, rights to water, and housing as vehicles for profit generation, rather than as human rights or services that exist for the public good, to spillover effects such as capital flight, offshore holdings, or tax evasion.
While the Fund increasingly identifies rising inequality as a risk factor, its policy prescriptions fail to integrate solutions capable of addressing the harms resulting from extreme wealth accumulation (see Briefing, Brace for impact: Social and gender inequalities in IMF surveillance).
Fernanda Balata of UK-based think tank New Economics Foundation (NEF) argues that, “Inequalities persist partly because the Fund’s analysis remains centred on income inequality, despite extensive evidence that wealth inequality – and in particular wealth concentration within the top 1% – generates far greater systemic distortions.”
Research by NEF, as part of the Extreme Wealth Line Initiative, “finds that new policy tools are required to measure and assess the resulting risks to democracy, economic resilience, and social justice,” Balata said. She added, “Integrating an Extreme Wealth Line into IMF surveillance – complementing indicators such as wealth and income Gini coefficients – would allow clearer identification of macroeconomic and political vulnerabilities, including capital flight, offshore accumulation, fiscal erosion, and democratic fragility.”
Such an approach would strengthen the Fund’s capacity to assess economic sustainability and resilience and would support more coherent policy advice and other tools needed to curb harmful concentrations of wealth.
