Wealth Distribution and Social Mobility in the US: A Quantitative Approach

Jess Benhabib, Alberto Bisin and Mi Luo

No 21721, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This paper attempts to quantitatively identify the factors that drive wealth dynamics in the U.S. and are consistent with its observed skewed cross-sectional distribution and social mobility. We concentrate on three critical factors: a skewed and persistent distribution of earnings, differential saving and bequest rates across wealth levels, and capital income risk. All of these factors are necessary for matching both distribution and mobility, with a distinct role in inducing wealth accumulation near the borrowing constraints, contributing to the thick top tail of wealth, and affecting upward and/or downward social mobility.

JEL-codes: E21 (search for similar items in EconPapers)
Date: 2015-11
New Economics Papers: this item is included in nep-dge and nep-mac
Note: EFG
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Citations: View citations in EconPapers (27)

Published as Jess Benhabib & Alberto Bisin & Mi Luo, 2019. "Wealth Distribution and Social Mobility in the US: A Quantitative Approach," American Economic Review, vol 109(5), pages 1623-1647.

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Journal Article: Wealth Distribution and Social Mobility in the US: A Quantitative Approach (2019)
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