The rise and fall of median wealth in the U.S.: A birth-cohort story

Philipp Jäger and Philip Schacht

No 989, Ruhr Economic Papers from RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen

Abstract: We use recently published long-run microdata (SCF+) to investigate generational wealth dynamics in the U.S. over the last seven decades. We document that the median wealth of people born in the first half of the 20th century increased from one ten-year birth cohort to the next. For people born in the second half of the century, median wealth successively declined from cohort to cohort while wealth inequality within birth cohorts increased markedly. A synthetic saving approach reveals that the trend reversal is mainly caused by changes in savings, which are a result of stagnating income levels and, importantly, declining saving rates. We find no evidence that shifts in wealth accumulation preferences, observable household characteristics or other demographic changes can explain our findings.

Keywords: Wealth inequality; cohorts; synthetic saving; United States (search for similar items in EconPapers)
JEL-codes: D14 D31 E21 J10 (search for similar items in EconPapers)
Date: 2023
New Economics Papers: this item is included in nep-fdg and nep-his
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.econstor.eu/bitstream/10419/280421/1/1872754325.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:zbw:rwirep:280421

DOI: 10.4419/96973155

Access Statistics for this paper

More papers in Ruhr Economic Papers from RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen Contact information at EDIRC.
Bibliographic data for series maintained by ZBW - Leibniz Information Centre for Economics ().