Racial Differences in the Returns to Educational Experiences on Bankruptcy Filings in Midlife

• In Event: 4124 - Section on Race, Gender, and Class Roundtables
  In Refereed Roundtable (100 min): Table 4. Inequalities

Abstract

Though bankruptcy is often described as a problem for the middle class, a population that has been historically dominated by White Americans, Black Americans are twice as likely to file for bankruptcy. At the same time, despite documented racial achievement gaps in school, Black Americans have been increasingly investing in higher education at rates equal or surpassing that of White Americans. The manuscript uses a unique longitudinal data set, and asks, what early educational experiences impact the likelihood of filing for bankruptcy in midlife? Furthermore, to what extent do racial differences in those experience help explain the racial gap in bankruptcy filings? Finding show that Black Americans do not get the same protection against midlife bankruptcy from math ability or degree completion that White Americans get. If they did, the bankruptcy gap could be reduced by as much as 20 percent.

Author

• Alicia Duncombe, University of Texas at Austin