> On May 18, 2010, at 3:34 PM, Jordan Hayes wrote:
>
>> If it was "mostly" inheritance, you'd have to believe that the
>> difference between the two groups from start to finish is that the
>> White group had someone with some wealth die during the 20 year period.
>
> Not just 20 years - it's a matter of generations. The best estimates I
> saw when researching Wall Street was that at least 50% of all personal
> wealth comes from inheritance or the appreciation of inherited
> property, and it could be closer to 75%.
It's definitely not because blacks save less. It's long been well established that black households save more than whites given any identical set of demographic characteristics. So, mathematically, if it's not higher savings it must be some combination of inheritance and investing in lower-returning assets. (There's some evidence for the latter - blacks save more than whites through low-yielding life insurance - but that itself requires explanation.)
SA