Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/98335
Authors: 
Altonji, Joseph G.
Doraszelski, Ulrich
Year of Publication: 
2000
Series/Report no.: 
Center Discussion Paper 850
Abstract: 
We explore the extent to which the huge race gap in wealth can be explained with properly constructed income and demographic variables. In some instances we explain the entire wealth gap with income and demographics provided that we estimate the wealth model on a sample of whites. However, we typically explain a much smaller fraction when we estimate the wealth model on a black sample. Using sibling comparisons to control for intergenerational transfers and the effects of adverse history, we find that differences in income and demographics are not likely to account for the lower explanatory power of the black wealth models. Our analysis of growth models of wealth suggests that differences in savings behavior and/or rates of return play an important role.
Subjects: 
Black-White Wealth Gap
Siblings
Savings
JEL: 
D31
J7
D91
Document Type: 
Working Paper

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