On May 18, 2010, at 2:54 PM, James Heartfield wrote:
> 'A $95, 000 question: why are whites five times richer than blacks
> in the US?'
> 'Inheritance' says Doug
> 'Really?' asks Eric, pointing out that income differential had not
> increased that much.
> But income differential is enough to account for the difference in
> ability to save and raise a mortgage on a house, the climbing value
> of which, I would guess, is the reason for the difference in wealth
> (i.e. fixed assets, not income).
But like I said in a follow-up post the wealth differential holds even for households with the same income and demographic profile. That's where inheritance comes in.
Doug