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Working Paper
Income and Wealth Inequality in America, 1949-2016
This paper introduces a new long-run dataset based on archival data from historical waves of the Survey of Consumer Finances. The household-level data allow us to study the joint distributions of household income and wealth since 1949. We expose the central importance of portfolio composition and asset prices for wealth dynamics in postwar America. Asset prices shift the wealth distribution because the composition and leverage of household portfolios differ systematically along the wealth distribution. Middle-class portfolios are dominated by housing, while rich households predominantly own ...
Report
Modigliani Meets Minsky: Inequality, Debt, and Financial Fragility in America, 1950-2016
This paper studies the secular increase in U.S. household debt and its relation to growing income inequality and financial fragility. We exploit a new household-level data set that covers the joint distributions of debt, income, and wealth in the United States over the past seven decades. The data show that increased borrowing by middle-class families with low income growth played a central role in rising indebtedness. Debt-to-income ratios have risen most dramatically for households between the 50th and 90th percentiles of the income distribution. While their income growth was low, ...
Briefing
Portfolios Across the U.S. Wealth Distribution
In this article, we examine how household portfolios vary with wealth, age and race. Households in the middle of the wealth distribution hold most of their wealth as real estate, while wealthier households are more heavily invested in stocks and private business equity. As households age, they repay education loans and other debt and accumulate real estate and (to a lesser extent) financial assets. We find that Black households hold considerably less home equity, stocks and business equity. This can be explained (statistically) by lower levels of total wealth and by differences in age and ...