America S Income And Wealth Inequality

America s Income And Wealth Inequality

Comparative research on income inequality has produced several frameworks to study the institutional determinants of income stratification.

In contrast, no such framework and much less empirical evidence exist to explain cross-national differences in wealth inequality. This situation is particularly lamentable as cross-national patterns of inequality in wealth diverge sharply from those in income. We seek to pave the way for new explanations of cross-national differences in wealth inequality by tracing them to the influence of different wealth components.

Drawing on the literatures on financialization and housing, we argue that housing equity should be the central building block of the comparative analysis of wealth inequality. Using harmonized data on 15 countries included in the Luxembourg Wealth Study LWSwe demonstrate a lack of association between national levels of income and wealth inequality and concentration.

Using decomposition approaches, we then estimate the degree to which national levels of wealth inequality and concentration relate to cross-national differences in wealth portfolios and the distribution of specific asset components. Considering the role of housing equity, financial assets, non-housing real assets, and non-housing debt, we show that cross-national variation in wealth inequality and concentration is centrally determined by the distribution of housing equity.]

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Definitions[ edit ] In social science, racial inequality is typically defined as "imbalances in the distribution of power, economic resources, and opportunities. Wealth can be defined as "the total value of things families own minus their debts. Family inheritance, which is passed down from generation to generation, helps with wealth accumulation. The Pew Research Center's analysis of government data says the median wealth of white households is 20 times that of black households and 18 times that of Hispanic households. According to the Federal Reserve of Cleveland the wealth gap between White and Black Americans has remained roughly the same since , back then the average White family had 7 times the wealth of the average Black family. Lower financial literacy is correlated with poor savings and adjustment behavior. America s Income And Wealth Inequality.