Are Successive Generations Getting Wealthier, and If So, Why?

Willaim G. Gale and Karen M. Pence
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Willaim G. Gale: Brookings Institution
Karen M. Pence: Board of Governors of the Federal Reserve System

Brookings Papers on Economic Activity, 2006, vol. 37, issue 2006-1, pages 155-234

Abstract: This paper examines the wealth of successive birth cohorts in the United States using data from the 1989-2001 Surveys of Consumer Finances. We find that older households (those aged 55-64, 65-74 or 75-84) in 2001 had more wealth than households of similar age in 1989, but that the same was not true of younger households. We also find that changes in standard demographic characteristics (marital status, educational attainment, years in the labor force, and health status) can explain most of the divergent trends across age groups. Given the historically large capital gains that accrued during the 1990s, these results raise some intriguing questions about the nature of saving and wealth accumulation during that decade.

Keywords: wealth; macroeconomics; generations; birth cohorts; capital gains (search for similar items in EconPapers)
JEL-codes: D31 E21 (search for similar items in EconPapers)

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