Does Childhood Family Instability Explain Racial Disparities in Wealth? Longitudinal Evidence from the U.S.

• In Event: 30620 - Section on Inequality, Poverty, and Mobility Roundtables
  In Refereed Roundtable (60 minute): Table 6: Race, Class, and Wealth Inequality

Abstract

The growing Black-White wealth gap has raised concerns and spurred research into the origins of racial inequality. Using data from the Panel Study of Income Dynamics (PSID), this study examines how childhood family instability affects wealth accumulation for Black and White individuals. Preliminary results show that while childhood family instability is more prevalent among Black children, its impact on wealth accumulation is more pronounced for Whites. Blacks consistently own less wealth and experience slower wealth growth, regardless of their family background, compared to their White counterparts. These findings suggest that the Black-White wealth gap is not primarily driven by the differential effects of childhood family instability, pointing to the need for further exploration of the underlying causes of racial wealth disparities. Future analysis will use the Blinder-Oaxaca decomposition method to investigate the roles of differential exposure rates and effect sizes of family stability in explaining the Black-White wealth gap.

Authors

• Xueqian Chen, The Ohio State University

• Meiyi Li, University of Wisconsin-Madison

• Xiaojie Shen, Peking University