Name: Why Taiwan Is Richer Than Japan and Korea
Uploaded: 2026-02-25T13:35:27.000Z
Duration: 22 min 44 s
Description: Thousands of YouTube videos with English-Chinese subtitles! Now you can learn to understand native speakers, expand your vocabulary, and improve your pronunciation...

Imagine a small, unremarkable neighborhood bar in a suburb of Seattle.

They are a representative sample of the American middle class.

A teacher, a plumber, a mid level software manager, perhaps a nurse.

If you were to freeze time and audit the net worth of every person in that room, counting their home equity, their 401 s, their savings accounts, and

subtracting their debts, the average wealth would likely hover around $100,000.

It is a room of stability, but certainly not one of luxury.

But then the door opens and Elon Musk walks in to order a beer.

Suddenly, the statistical reality of that room breaks.

If you were to now calculate the mean average wealth of the 11 people in that bar, every single person is now statistically a billionaire.

But in the real world, their lived experience hasn't changed by a single cent.

This is the fundamental flaw of contemporary economic analysis.

The arithmetic mean is a utilitarian metric for assessing the aggregate power of an economy.

It tells you how many aircraft carriers a nation can build or how many semiconductor fabs it can subsidize.

But it is a deeply flawed instrument for measuring the lived experience of the citizenry.

In an era of increasing global inequality, the mean is susceptible to massive distortion by the extreme outliers at the top of the distribution curve, the ultra high net worth individuals whose fortunes pull the average upwards, masking stagnation in the lower deciles.

The 2024 UBS Global Wealth Report provided a stark illustration of this distortion.

The United States and Switzerland unsurprisingly, dominate the rankings.

These nations are the homes of the guys walking into the bar, the immense concentrations of capital, the tech moguls and the dynastic banking families.

Under this metric, the island of Taiwan appears prosperous.

Yet it still trails the massive aggregate wealth of the United States and Australia.

However, the data reveals a historic shift.

Even in this mean metric, Taiwan has quietly surged past its primary industrial competitors.

While it trails the financial city states of Singapore and Hong Kong, Taiwan now boasts a higher mean wealth per adult than the major economies of East Asia, surpassing both South Korea and Japan.

Yet the true divergence is not found in the average, but in the median.

Shifting the lens to median wealth, the value that divides the population into two perfectly equal halves, reveals a dramatically different landscape.

Data derived from that same 2024 report highlights a pivotal realignment in global prosperity.

While the United States boasts a massive mean wealth driven by the top 1% sitting at over half a million dollars, its median wealth sits at roughly US$112,000.

In contrast, Taiwan presents a phenomenon we might call the median anomaly.

Despite having a lower nominal GDP per capita than the U.S.

taiwan's median wealth per adult stands at approximately US$110,000.

This figure is statistically significant for several reasons.

First, it places the typical Taiwanese adult on par with the typical American in terms of net assets, a feat achieved without the benefit of the US Dollar's reserve currency status or the American endowment of natural resources.

Second, and perhaps more relevant to the regional context, it places Taiwan well ahead of its primary competitors.

It has surged past Japan, long considered the bastion of Asian stability, by nearly 15% and maintains a distinct lead over South Korea.

Even traditionally wealthy European nations like Germany lag behind Taiwan in this metric.

To understand the wealth of 2024, we first have to understand the inequality gap.

In economics, the ratio between the mean and the median is often used as a proxy for inequality.

In the United States, that ratio is roughly 5 to 1.

This reflects a society where the vast majority of wealth gains are captured by the top 1%.

This implies that the wealth generated by Taiwan's export machine is sticky.

It sticks to the middle class rather than flowing exclusively to the top.

But if you talk to a young person in Taipei, they won't tell you they feel rich.

In fact, for the last two decades, Taiwanese political discourse has been haunted by the memory of the 22k curse.

This references a controversial government subsidy program launched post 2008 which effectively pegged starting salaries at 22,000 new Taiwan dollars.

While the nominal wage floor has since risen to nearly 28,000 new Taiwan dollars, wage growth in Taiwan remains anemic compared to the soaring cost of real estate.

If you are a mid career manager at Samsung or Hyundai in South Korea, you earn a salary significantly higher than your counterpart at a Taiwanese manufacturing firm.

You wear a more expensive suit, but statistically the Taiwanese counterpart has a healthier balance sheet.

This discrepancy, high assets despite low wages is not a contradiction but a feature of a specific economic model.

It is the result of what we define as the boss culture multiplier.

In Taiwan, a significant portion of household income is not derived from wages which are suppressed, but

from entrepreneurial profits, capital gains and tax advantaged shadow economy activity.

While the Korean salaryman relies on a paycheck that is heavily taxed and eroded by high living costs.

The Taiwanese boss relies on equity, dividend yields and asset appreciation.

To see where this divergence began, we have to go back to the architectural blueprints of these economies drawn in the rubble of 1945.

Both Taiwan and South Korea emerged from Japanese colonization in 1945 with a shared set of advantages.

High literacy rates, a familiarity with industrial bureaucracy, and

a fierce anti communist alignment that secured them massive amounts of American aid.

However, as they began to industrialize in the 1960s, their governments chose two radically different paths to capitalism.

In South Korea, under the authoritarian leadership of Park Chung Hee, the state pursued a strategy of unbalanced growth.

They selected specific industrial conglomerates, the chaebol, to spearhead modernization.

Companies like Samsung, Daewoo and LG were granted preferential low interest loans, import protection and massive government contracts.

Park believed that to compete with Mitsubishi or General Electric, Korea needed companies of equal size.

It transformed South Korea into a global powerhouse in shipbuilding, automobiles and memory chips.

The chaebol vacuumed up capital and talent, relegating small and medium enterprises SMEs to a subservient role in the Korean model.

The SME became a supply chain vassal, dependent on contracts from the giants and lacking the autonomy to export independently.

The chaebol would lead the nation and the citizen would serve as the employee.

Wealth accumulation would occur at the corporate level and trickle down through wages across the strait.

The Kuomintang government in Taiwan operated under a completely different paranoia.

Having just lost mainland China to the communists, they were deeply suspicious of private capital accumulation.

They feared that if private tycoons became too wealthy, they would challenge the state's political power.

Consequently, while the KMT retained state control over the commanding heights of the economy, utilities, banking, steel and petrochemicals, they left the export sector largely open to the private sector.

Crucially, the government did not pick winners in the export sector to the same extent as Seoul.

Instead, they fostered an environment conducive to small business.

The kingdom of SMEs was born not just from policy, but

from the lack of a crushing corporate monopoly.

Taiwan's industrialization was driven by tens of thousands of family owned firms producing everything from plastic toys to umbrellas, then bicycle parts and eventually PC motherboards.

This decentralized structure meant that the profits of industrialization were distributed across thousands of balance sheets rather than dozens.

When Taiwan began its export boom in the 1970s.

The wealth generated was business income for hundreds of thousands of families, not just wage income for workers.

This structural reality reinforced a cultural algorithm that dictates Taiwanese economic behavior to this day.

Better to be the head of a chicken than the tail of a cow.

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Why Taiwan Is Richer Than Japan and Korea

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