Reflections on Americans' Net Worth
An economics professor analyzes Survey of Consumer Finances data to argue that American net worth is significantly higher than populist narratives suggest. The author contends that wealth inequality is largely a function of age rather than a systemic failure of the middle class.
Why it matters
It challenges prevailing economic anxiety narratives by providing a data-driven perspective on household wealth and financial stability.
I’ve been an economics professor for almost 30 years, but I don’t think I’ve ever before seen anything like the table below. I knew that claims that “58% of Americans can’t afford a $1,000 car repair” were laughable clickbait. I knew that — measured by income — the middle class is disappearing… by becoming upper-middle class . But only recently did I start to fully appreciate the chasm between populist pessimism and actual data on Americans’ net worth. From the 2022 Survey of Consumer Finances:
I had ChatGPT work with the actual data , which it then cross-checked against other published estimates. The SCF net worth data is ultimately derived from very finely-grained self-reports, designed to remind respondents to put a dollar value on each and every one of their notable assets and liabilities.
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