THE DISTRIBUTIONAL EFFECTS OF THE 1969–75 INFLATION ON HOLDINGS OF HOUSEHOLD WEALTH IN THE UNITED STATES

Edward N. Wolff

    Research output: Contribution to journalArticle

    Abstract

    Using a simple simulation model, this paper assesses the impact of relative movements in asset prices on the distribution of wealth during the 1969–75 period. Because of the strong negative correlation between wealth level and the ratio of debt to wealth, this particular inflation induced a substantial drop in the overall level of wealth inequality. Moreover, comparing the portfolios of different demographic groups, we found that middle‐aged households gained relatively to younger and older ones, married couples gained relatively to singles, whites gained relatively to non‐whites, and home‐owners gained relatively to renters. The biggest gainers from this inflation were home‐owners with large mortgages and the biggest losers the large stock holders.

    Original languageEnglish (US)
    Pages (from-to)195-207
    Number of pages13
    JournalReview of Income and Wealth
    Volume25
    Issue number2
    DOIs
    StatePublished - Jun 1979

    ASJC Scopus subject areas

    • Economics and Econometrics

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