Four hundred years ago, America’s first enslaved Africans arrived in Virginia.
Centuries later, black Americans have managed to accumulate some wealth, but it still pales in comparison to that of whites. This racial wealth gap is a result not only of the horrors of slavery but also policies – such as Jim Crow laws, redlining and modern-day mass incarceration – that followed.
The average white family with at least one working adult over 25 years old owned more than nine times as much total wealth as a black one in 2016.
As a scholar of wealth inequality and its causes, I believe the promise of equal opportunity for all remains unfulfilled as long as this massive gulf persists. A variety of proposals have been suggested by Democratic candidates for president and others to close this gap, such as eliminating housing discrimination and making college free for all.
Two colleagues and I created an economic simulator to model the impact of five of the most ambitious proposals. Our results show why reparations that directly target African Americans are likely the only way to eliminate it.
Why Wealth Matters
This wealth gap matters a lot because it means African Americans have far fewer opportunities to get ahead and less economic security.