Wealth Accumulation by Age Cohort in the U.S., 1962-1992: The Role of Savings, Capital Gains and Intergenerational Transfers

Edward N. Wolff

    Research output: Contribution to journalReview article


    A simulation model is developed to account for observed changes in mean household wealth both overall and by age cohort over the 1962-92 period in the U.S. There are three major findings. First, capital gains are the major factor explaining overall wealth changes and account for three-fourths of the simulated growth in wealth over the entire period, while savings account for the other quarter. Second, for cohorts under age 50, inter vivos transfers dominate observed changes in wealth. Indeed, the oldest age groups appear to have transferred sizable amounts of their wealth to younger generations inter vivos, raising the wealth of these younger groups substantially above what it would be based on saving alone. Third, over the lifetime, I estimate that savings, inheritance, and inter vivos transfer each contribute about one-third to the lifetime accumulation of wealth.

    Original languageEnglish (US)
    Pages (from-to)27-49
    Number of pages23
    JournalGeneva Papers on Risk and Insurance: Issues and Practice
    Issue number1
    StatePublished - Jan 1999


    ASJC Scopus subject areas

    • Accounting
    • Business, Management and Accounting(all)
    • Finance
    • Economics and Econometrics

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