The black-white wealth gap has been explained as a history of discrimination that's led to black families accumulating less wealth, on average, than their white counterparts. But a new argument put forth by a Princeton graduate student claims it's also due to family ties.
The Boston Globe reports
on sociologist Rourke O'Brien's study
showing that upper-income blacks give more of their money to friends and family than upper-income whites, who are far less likely to have a poor sibling or parents living in poverty. This makes it difficult to save and accumulate wealth, claims O'Brien.
"Obligations of group membership can have stratifying consequences for individuals," O'Brien writes, who documents the greater amount of "informal financial assistance" he sees among black families relative to white ones.
"These transfers of money can have a big impact on wealth accumulation," writes the Globe
. "Money that's donated to poor friends and family usually goes to meet immediate material needs, rather than accumulating interest, earning dividends, or riding the stock market."
Via the Boston Globe