Does Self-control Predict Wealth Creation Among Young Baby Boomers?

Why similar people have different patterns of wealth accumulation is puzzling. The behavioral life-cycle hypothesis indicates self-control is an important aspect of household saving behavior. This study investigated if household wealth creation from 1994 to 2008 could be predicted by self-control among a sample of young baby boomers using National Longitudinal Survey of Youth (NLSY79) data. Variables that significantly predicted 2008 net worth included homeownership, 1994 net worth, income, bankruptcy filing, inheritance, education level, race, marital status, children, retirement planning activities, locus of control, and self-mastery. The addition of self-control predictors to a regression model improved the model’s ability to predict net worth by 1.3 % above and beyond the human capital, financial status, and demographic predictor variables. In total, the model explained 60 % of the variance in net worth. Findings indicated that individuals who invested in their human capital, were homeowners, and had higher self-control, accumulated more wealth.     

Early-life origins of the race gap in men's mortality

Using a life course framework, we examine the early life origins of the race gap in men's all-cause mortality. Using the National Longitudinal Survey of Older Men (1966-1990), we evaluate major social pathways by which early life conditions differentiate the mortality experiences of blacks and whites. Our findings indicate that early life socioeconomic conditions, particularly parental occupation and family structure, explain part of the race gap in mortality. Black men's higher rates of death are associated with lower socioeconomic standing in early life and living in homes lacking both biological parents. However these effects operate indirectly through adult socioeconomic achievement processes, as education, family income, wealth, and occupational complexity statistically account for the race gap in men's mortality. Our findings suggest that policy interventions to eliminate race disparities in mortality and health should address both childhood and adult socioeconomic conditions.     

A Case Study of Mortgage Refinancing Discrimination: African American Intergenerational Wealth*

A case study approach is taken to examine differences between African Americans and white Americans in their respective approval/denial rates for home mortgage refinancing. Data from a regional banking institution is used for the case analysis. These data indicate that African Americans are significantly more likely to be turned down for mortgage refinancing than their white American counterparts. We suggest that refinance discri‐mination is one contributing factor to the continuing wealth or net worth gaps between blacks and whites. The inability to access the potential capital resident in one's home impedes the ability of African Americans to transmit advantage from one generation to the next.     

The effect of disability on the net worth of elderly people

As demographic shifts make the Social Security program financially vulnerable, the responsibility for income security in old age will shift from the government to elderly people. In this changing environment, the accumulation of wealth will be a crucial issue because wealth holders can draw income from assets, which can supplement retirement income. Thus, wealth (or net worth) is a proximate indicator of economic well-being of the elderly. This article presents the findings of a study of the net worth of elderly people with disabilities. The major findings were that a smaller proportion of elderly people with disabilities has assets of any type compared with elderly people with no disability; the dollar value of each type of asset is smaller among elderly people with disabilities than among elderly people with no disability; and the net worth of people with disabilities is smaller than that of elderly people with no disability even after other variables were controlled.     

The Determinants of Racial Disparities in Perceived Job Insecurity: A Test of Three Perspectives

Why do African Americans report higher levels of perceived job insecurity than whites? We analyze data from the 1996 and 1998 General Social Survey to test alternative predictions from the compositional, inclusive‐discrimination, and dispositional perspectives concerning the sources of the racial gap in perceived insecurity. Results from ordered probit regressions provide most support for the inclusive‐discrimination perspective, which maintains that employment practices associated with “modern racial prejudice” induce perceived insecurity on a widespread and generalized basis among African Americans. Accordingly, compared to whites, African Americans experience perceived insecurity net of human capital credentials and job/labor market characteristics. Additional analyses provide one qualification to these findings: dynamics associated with the inclusive‐discrimination perspective are more pronounced in the private sector than the public sector.     

Race,Class, and Support for the Welfare State*

Two competing approaches to the study of African Americans—the race and class perspectives—have dominated attempts to explain their views on contemporary issues. To examine the race versus class debate, this study uses African Americans' views on government spending for five social welfare concerns: (1) improving and protecting the nation's health, (2) solving the problems of big cities, (3) halting rising crime rates, (4) dealing with drug addiction, and (5) improving the nation's education system. Data from the 1972–1990 General Social Surveys are used to compare middle-class blacks with both working-class blacks and whites and middle-class whites in terms of their support for government spending for those five social welfare issues. Examining group means, we found no significant difference between the two black classes but a significant difference between the black middle class and the white middle class on support for government spending in all areas except halting the rising crime rates (where there were no significant differences among the four groups). Similarly, using logistic regression analysis we found that race continued to have a significant effect on support for spending even after controlling for class, year, age, gender, education, income, and occupational prestige. In respect to social welfare spending, the results indicate support for the race, as opposed to the class, perspective; that is, race is better than class for predicting African American attitudes on government spending.     

Wealth as Security: Growth Curve Analyses of Household Income and Net Worth During a Recession

Building on evidence of increasing inequality with the 2008–2009 recession, we asked whether households experienced different financial trajectories through the recession depending on initial income and net worth. Using growth curve models of households headed by young adults in the Panel Study of Income Dynamics, we compared the relationship between initial income and net worth and the rate of change of income and net worth from 1989 to 2011 among households with income above and below $50,000. We found different patterns of income change and different relationships among income, net worth, and their rates of change between high- and low-income categories. Results suggest initial wealth helped to stabilize income and wealth changes among higher income households, reducing financial insecurity.     

“Call to Home?” Race,Region, and Migration to the U.S. South, 1970–20001

This research examines recent migration patterns of native‐born blacks and whites to the U.S. South. Our primary research questions concern race and regional migration dynamics, and whether new insights into such can be gleaned by comparing migrants to the South with persons moving within the non‐South. Using samples of 1970–2000 census data, we focus on race differences in the tendency to choose the South as a migration destination, and whether whites and blacks differ in key selection mechanisms shaping movement to different regional destinations. We observe increasing rates of black (compared to white) migration to the South. Additionally, patterns of selectivity within this growing African‐American migration stream are especially dramatic when southern migrants are compared to persons moving within the non‐South. Our analyses also show that black migrants are targeting particular parts of the South (e.g., states where blacks are a larger share of the population), suggesting that future research should disaggregate the “Census South” region to provide a more comprehensive picture of contemporary interregional migration in the United States.     

Self-Perceived Physical Attractiveness,Self-Esteem,Race, and Gender

Abstract

African American self-perceptions of physical attractiveness are found to be higher than white self-perceptions, while there is no difference by race in the correlation between self-perceived attractiveness and self-esteem. Controlling for self-perceived attractiveness, African Americans have lower self-esteem than whites, suggesting that African American perceptions of physical attractiveness, mirrored in the slogan “Black is Beautiful,” may have contributed to the disappearance over the past forty years of the gap between African American and white self-esteem. Self-esteem is more strongly related to self-perceived physical attractiveness for females than males, particularly among whites.     

A multi-group structural equation model (SEM) examining asset holding effects on educational attainment by race and gender

Little is known about the processes through which parents' and children's wealth may influence children's math and reading scores. Even less is known about how these processes may vary across race and gender. In this study we analyze Panel Study of Income Dynamics (PSID) data using multi-group structural equation modeling (SEM) to examine wealth effects by gender (male/female) and race (white/black). Results suggest that there are important statistical differences across race and gender. For example, we find that children's school savings predict math scores among white children but not black children. Net worth is a positive predictor of black males' math scores but a negative predictor of black females'. In the case of income, we find that it is directly related to black females' math scores but not black males'. In general, findings suggest that liquid forms of wealth (i.e., forms of wealth that are easily converted into cash) may be better predictors of children's academic achievement than net worth.     

Racialized Incorporation: The Effects of Race and Generational Status on Self‐Employment and Industry‐Sector Prestige in the United States

This study examines how race and generational status shape self‐employment propensities and industry‐sector prestige among the self‐employed in the U.S. It draws on theories of assimilation, racialization, and a combined framework, racialized incorporation, to guide the analysis and interpret the results. It uses data from the U.S. March Current Population Survey (2000–2010) offering the first nationally representative examination of second‐generation self‐employment in the U.S. This study investigates three questions. First, do the odds of being self‐employed decline in the second and third generations? Second, do generational patterns in self‐employment propensities vary by race? And finally, do race and generational status affect the odds of being self‐employed in low‐, medium‐, and high‐prestige industry sectors? Results offer some support for the assimilation perspective: Immigrants are generally more likely than third‐generation groups to be self‐employed with the exception of Asians, where second‐generation Asians have the greatest odds of being self‐employed. However, results also reveal that generational patterns in self‐employment propensities vary by race and industry‐sector prestige. Accordingly, first‐ and second‐generation whites have the greatest odds of being self‐employed (across all levels of industry‐sector prestige), and third‐generation whites are more likely than all generations of blacks and Hispanics to be engaged in high‐prestige self‐employment. These findings suggest that immigrants, their offspring, and native‐born groups undergo a racialized incorporation in which self‐employment is organized along hierarchical and racial lines associated with uneven levels of prestige.     

Unequal returns: Intragenerational asset accumulation differs by net worth in early adulthood

We use quantile regression models of Panel Study of Income Dynamics (PSID) data to assess whether initial net worth moderates the relationship between initial economic standing (net worth and income) and later net worth (measured in 2011). Conditional quantile regression results suggest the returns to an increase in 1989 net worth or income vary substantially between the 25th, 50th, and 75th percentiles of 1989 net worth, with higher returns among those with higher initial net worth. Thus, financial improvement appears to generate different outcomes depending on initial net worth. These results suggest that helping families build an asset foundation may increase the efficacy of interventions that increase family income.     

Wealth and inheritance in Britain from 1896 to the present

Personal wealth has grown since the 1970s twice as fast in real terms as national income. Has this rise in the wealth-income ratio led to a corresponding increase in the wealth being passed on from one generation to the next? Are we returning to the levels of inheritance found in the 19th century? The aim of this paper is to construct UK evidence on the extent of the transmission of wealth in the form of estates and gifts inter vivos. It takes a long-run view of inheritance, starting from 1896, when the modern Estate Duty was introduced, and exploits the extensive estate data published over the years. Construction of a long-run time series for more than a century is challenging, and there are important limitations. The resulting time-series demonstrates the major importance of inheritance in the UK before the First World War, when the total transmitted wealth represented some 20 per cent of net national income. In the inter-war period, the total was around 15 per cent, falling to some 10 per cent after the Second World War, and then falling further to below 5 per cent in the late 1970s. Since then, there has indeed been an upturn: a rise from 4.8 per cent in 1977 to 8.2 per cent in 2006. This increase was more or less in line with the increase in personal wealth, and has to be interpreted in the light of the changing net worth of the corporate and public sectors of the economy.     

Comparing Offers and Take‐ups of Employee Health Insurance across Race,Gender, and Decade*

How often do U.S. employees receive health insurance offers from employers? When offered, how often do they take up their employer‐based health insurance? This article uses the 1992 and 2002 waves of the National Study of the Changing Workforce (NSCW) to investigate changes in access to (offers) and employees electing to accept, take, or purchase their employers’ health insurance plans (take‐ups) among wage and salaried workers. Although much research has studied employee health benefits, little has examined the intersection of gender and race regarding both offers and take‐ups of such benefits. Logistic regression results indicate that offers and take‐ups of personal health benefits declined from 1992 to 2002, net of salient controls. Further analyses demonstrate that these declines did not affect all workers identically. Offers declined somewhat for both women and men among whites and African Americans, but declined more among Hispanic women and men. Among other ethnoracial groups, offers declined the most among men, but increased among comparable women. Take‐ups declined among white men and Hispanic workers. However, white and African American women's take‐ups did not change and among African American men take‐ups increased. We discuss the need to examine gender and race simultaneously and urge researchers to more closely examine changes in health benefit offers and take‐ups.     

Racial inequality and social control: Historical and contemporary patterns in the U.S. South

Research dealing with disproportionate criminality, arrest, and incarceration among African Americans has tended to emphasize cultural, familial, and structural differences between racial groups while at the same time neglecting patterns and processes of race‐ and class‐based antagonism and subordination that are central, especially in the case of the U.S. South historically. We attempt to address this limitation by posing a model of the contemporary black‐white arrest differential across counties of one southern state. The model itself takes into consideration class‐ and race‐based subordination processes and their impact on local levels of stratification and arrest. Results suggest the continuing influence of racial competition and class dynamics. Racial competition enhances the arrest gap by disproportionately increasing unemployment and family dissolution among African Americans. The existence of a strong and concentrated traditional elite is shown to depress the racial gap, presumably by increasing poverty, unemployment, and family dissolution for both groups or by shaping what it means to go to jail, especially for blacks. In general, the arguments and findings presented suggest that criminological literature and theorizing should take note of local racial and political‐economic processes that, through the perpetuation of race and class inequality, reproduce disparate patterns of criminality, arrest, and incarceration.     

“It's Hardly Fair to Bring a Child Into the World With the Way Things Look…”: Anomie,Mistrust, and the Impact of Race,SES, and Gender

This article examines the impact of race, socioeconomic status (SES ), and gender on subjective outlook using anomie and general mistrust as indicators. Specifically, this study addresses the following questions: (1) How do African Americans and whites compare with respect to anomie and mistrust? (2) Do racial differences in anomie and mistrust vary by SES ? (3) Do African American women have higher levels of anomie and mistrust than whites and African American men? and (4) Are African Americans becoming more or less trusting and anomic over time? Using data from the General Social Survey (GSS) (1972–2014), the analysis reveals significant racial differences in social outlook as measured by anomie and mistrust. African Americans indicate higher levels of both anomie and mistrust than whites even after controls for SES and the other variables. The racial gap in anomie and mistrust increases with increases in SES . Being African American and female is associated with higher levels of anomie but not mistrust. African American mistrust decreases relative to whites over time. More affluent African Americans’ anomie levels slightly increase relative to similar whites over time. Explanations using the “rage of a privileged class” and “intersectionality” ideas are evaluated.     

Education loans and wealth building among young adults

With the use of education loans growing rapidly as a way to finance college education, it is important to examine how such loans impact the future financial well-being. This study examines the association between education loans and postcollege wealth accumulation among young adults, the group with the greatest share of outstanding education loans. Data come from 15 rounds of data of the 1997 National Longitudinal Survey of Youth, and the analyses control for a number of student characteristics, college experiences, and parental income. Results from a treatment-effects model indicate that having education loans upon leaving college is negatively related to postcollege net worth, financial assets, nonfinancial assets, and value of primary housing. Furthermore, having education loans also has an additional negative link to the value of net worth among Black young adults. The relationship between the amount of education loans and wealth accumulation is not statistically significant among those with outstanding loans. The study findings indicate the importance of developing alternative approaches, instead of additional loans and other credits, to meet the financial needs of college students.     

Changes in durable stocks, portfolio allocation, and consumption expenditure in the aftermath of the Kobe earthquake

To understand the household recovery process from unexpected serious damage caused by a natural disaster, we analyze household data from the Kobe earthquake in 1995. We address three questions—how damaged stocks of durable wealth are reinvested, how an ex post portfolio of borrowing or dissaving is reallocated to diversify the asset shocks caused by the disaster, and how formal and informal consumption insurance mechanisms are effective for amending home damage—all of which have been largely unanswered. We obtain three findings. First, people respond to negative income changes and housing damage by reinvesting damaged wealth. Second, households borrow extensively to amend the large housing damage caused by the earthquake. However, they dissave only for minor household asset damage. Third, consumption smoothing is not achieved for nondurable goods that are significantly affected by negative income changes and household asset damage. These findings suggest that asset shocks caused by a large natural disaster are not sufficiently diversified for households, indicating a large gap in designing effective insurance mechanisms.     

The concept and measurement of asset poverty: Levels, trends and composition for the U.S., 1983–2001

American prosperity in the second half of the 1980s together with the booming economy of the 1990s created the impression that American households have done well, particularly in terms of wealth acquisition. In this paper, we develop the concept of “asset poverty” as a measure of economic hardship, distinct from and complementary to the more commonly used concept of “income poverty.” We define a household with insufficient assets to enable it to meet basic needs (as measured by the income poverty line) for a period of three months to be asset poor. The results reveal that in the face of the large growth in overall assets in the U.S. and a fall in standard income poverty over the period from 1983 to 2001, the level of asset poverty increased from 22.4 to 24.5 percent. We also find that asset poverty rates for blacks and Hispanics are over twice those for whites; that asset poverty rates fall monotonically with both age and education; that they are much higher for renters than homeowners; and that by family type they range from a low of 5 percent for elderly couples to 71 percent for female single parents.     

The Continuing Significance of Race in the Occupational Attainment of Whites and Blacks: A Segmented Labor Market Analysis*

In this article we posit that racial discrimination is not uniform across the U.S. labor market. While it is likely that patterns of racial discrimination occur in some types of jobs more than others, little empirical research has examined the effect of race across segmented labor markets. Incorporating two decades of comparable General Social Survey data, this article revisits William J. Wilson's hypothesis that the significance of race in determining labor market outcomes is declining. We examine the effect of race within two dissimilar labor segments over time, dividing the labor market into technique‐versus social‐skills‐oriented segments. Using this theoretically useful dichotomy, we examine if the net effect of race (African American and white men) on occupational prestige has declined from the 1970s to the 1990s. Our multivariate analysis shows that the net effect of race is different in each labor market. This suggests that racial discrimination against African Americans is not uniform across the entire labor market, but instead is differentiately manifested within various labor market segments. Overall, our findings partially support Wilson's thesis indicating that while the effect of race is no longer a significant indicator of occupational prestige by the 1990s in a technique‐oriented job segment, it remains a significant predictive variable within a social‐skills‐oriented job segment, even when controlling for a range of social class and structural variables.