A new study led by researchers at Duke University in North Carolina has found the modern racial wealth gap in the United States is growing thanks to the cumulative impact of the country’s history with racism and inequities in intergenerational wealth.
The authors reviewed information from the Federal Reserve’s Survey of Consumer Finances from 2019 to 2022. Over this time period, the average net worth gap between Black and White Americans grew by 38 percent, and is now approximately $1.15 million.
Historically, the racial wealth gap in America has been attributed to gaps in educational attainment. However, the study debunks this popular theory, finding households led by Black Americans with a college degree have less wealth than households led by White Americans with a high school diploma.
Additionally, White Americans were found to be more likely to receive financial gifts and inheritances than Black Americans. This intergenerational wealth is a significant contributor to the racial wealth gap, as it provides White Americans with increased financial security and economic opportunities.
In order to reduce the American racial wealth gap, the authors believe federal policymakers should investigate reforming federal tax policies that have historically enabled wealthy White Americans to pass on wealth to younger generations. They are also supportive of reparations for Black families whose ancestors were formerly enslaved in the United States, as they believe this could increase Black wealth while not adversely reducing White wealth.
