Working Paper: NBER ID: w28383
Authors: Edward N. Wolff
Abstract: Median household wealth shot up by 21.2 percent in real terms between 2016 and 2019, as asset prices continued to rebound. However, 2007 still remains the watershed year, and median wealth was down 20.4 percent relative to 2007, though mean wealth more than fully recovered. There was a modest remission in wealth inequality, with the share of the top one percent down by 1.4 percentage points, that of the top 20 percent down by 1.0 percentage points, the Gini coefficient down by 0.008, and the mean wealth of the top one percent also down by 1.9 percent. The homeownership rate finally rebounded a bit, by 1.2 percentage points, to 64.9 percent. The stock ownership rate advanced by 0.4 percentage points to 49.6 percent, though still down from its 2001 peak. Though the mean debt of the middle class rose by 10.7 percent in real terms, the debt-income and debt-net worth ratios remained largely unchanged. The black-white gap in mean net worth remained unchanged, as did the Hispanic-white wealth gap. The wealth of households under age 35 continued to deteriorate in both absolute and relative terms between 2016 and 2019.
Keywords: household wealth; wealth inequality; median wealth; economic recovery
JEL Codes: D31; J15
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Great Recession (G01) | median household wealth (D31) |
| collapse of asset prices (E44) | median household wealth (D31) |
| median household wealth (D31) | recovery from 2010 to 2016 (E65) |
| median household wealth (D31) | recovery from 2016 to 2019 (P27) |
| economic recovery phases (E65) | changes in wealth distribution (D31) |
| economic recovery phases (E65) | Gini coefficient (D31) |