Читать книгу Wealth - Yuval Elmelech - Страница 9

What do social scientists really know about wealth mobility and inequality? While research on education and labor market attainment has been quite extensive, wealth analysis was marginalized or entirely overlooked for most of the twentieth century. This perplexing neglect can be attributed to the theoretical emphasis, particularly in the US, to individual educational and occupational attainment; on the lack of reliable data concerning assets and wealth holding; and to the absence of substantial wealth among the majority of the population. Since the mid-1980s, though, there has been renewed interest in wealth accumulation and inequality as a topic of social research. This welcome development coincides with what I will later term “the rise of wealth”—that is, the general growth in asset ownership, the advent of wealth as a key determinant of living standards and well-being, and the increase in wealth inequality.

Conceptually, the study of wealth represents a drastic shift in the way social scientists view the origin and consequences of social mobility and stratification. As an accumulated stock of tangible and financial assets, wealth holding provides economic security and has been associated with self-sufficiency and the owner’s ability to circumvent the demands of the collective and decrease reliance on members of the community (Penalver 2005). A lack of assets and wealth, on the other hand, results in dependence on others (employers, family members, welfare officers) as a way of maintaining an adequate standard of living. Meade (1964: 39) succinctly describes these features of wealth:

A man with much property has great bargaining strength and a great sense of security, independence, and freedom … The propertyless man must continuously and without interruption acquire his income by working for an employer or by qualifying to receive it from a public authority.¹

As well as having these more generalized benefits, household wealth can be used as collateral for loans, in order to overcome liquidity constraints or to finance consumption during times of crisis, for example during illness or disability, incarceration, unemployment, divorce, and other situations involving unexpected expenses (Spilerman 2000). Ownership of financial assets (bank deposits, stocks, and bonds) can generate income, and ownership of tangible assets has important use value: a car, for example, enables mobility as well as access to employment opportunities, while homeownership has been associated with greater individual autonomy, long-term investment planning, and access to public services (Sherraden 1991; Gibson-Davis 2009).

Finally, material possessions convey the owner’s social standing and influence in the community, and command over great wealth has been associated with political power (Mills 1956; Domhoff 2002; Khan 2012). Moreover, intergenerational wealth transfers in the form of inter vivos gifts (gifts between two living persons) and bequests (gifts made through a will) are an important mechanism of parental investment in their children’s human capital and economic well-being (Grinstein-Weiss et al. 2014; Conley 2001), and one that has significant implications for the reproduction of socioeconomic inequality. The substantial amount of wealth transferred every year from older to younger generations—estimated to be between $600 billion and $900 billion in the US and between €150 billion and €200 billion in Germany (Beckert 2008: 14)—is likely to only intensify wealth inequality in the future (Piketty 2014).

In addition to the intrinsic importance of wealth as a measure of well-being and living standards, the research population in wealth analysis is notably broad. The conventional unit of analysis in general stratification research is an individual worker within a limited age range: typically, a 25–65-year-old. However, since the life expectancy in economically developed countries now exceeds 80 years (its highest recorded level), conventional stratification research captures only a limited, and gradually decreasing, segment of the population. By contrast, wealth research is unrestricted by constraints such as age and employment status. The age range of the research population in wealth studies extends beyond the typical working age and continues into post-retirement life; nor is the research population restricted to individuals who are in the labor force—it encompasses instead the family as a whole.

Changing demographic circumstances and rising lifespans mean that, within wealth research, labor market remunerations are increasingly being viewed merely as a first step toward achieving financial security. Consider, for example, the responses of first-year university students to the following question: If I were to offer you a large sum of money, say $200,000, on condition that you leave college and never complete a degree at any institution of higher education, how many of you would take the money? It is likely that some students would raise their hands, but many others would hesitate. If one kept pressing the remaining students by increasing the amount of money offered (e.g. $500,000, then $1 million, and so on), fewer and fewer students would “reject” the progressively generous offer, and eventually the vast majority of students would come to accept it and quit their studies. There would be only a handful of students who, for various reasons ranging from the joy of learning to the intrinsic value of education or the future job satisfaction they would hope to find with an academic degree, would not accept the endowment. Occasionally a student would cite family fortune and the expectation of inheriting a significant amount of wealth as reasons for declining the offer.

The main takeaway from this exercise is that education and work—often perceived as key components of socioeconomic status—are considered primarily as vehicles for obtaining economic security in the form of accumulated wealth. A recent survey on well-being carried out among adult Americans confirmed this view. The vast majority (87%) of participants agreed that “nothing makes them happier or more confident than feeling like their finances are in order”; accordingly, people’s concerns about household finance outpaced concerns associated with career and personal relationships (Northwestern Mutual 2019).

Another feature of the wealth paradigm, and one already alluded to, is that the principal units of analysis in wealth research are families, households, and the individuals who compose them. By studying individuals, households, and families rather than solely individuals, wealth scholarship takes into account the welfare of all members of society, including those who are unemployed or not in the labor force: children, older adults, and stay-at-home parents. Consequently, social and demographic groups that are traditionally underrepresented in the labor market, such as women and economically marginalized racial and ethnic groups (Azmat et al. 2006; OECD 2006: 16; Quillian et al. 2017), are not excluded from the analysis.

The wealth paradigm’s emphasis on a family’s stock of material resources has a number of important theoretical implications. For instance, because analytical models of wealth accumulation focus on families, they incorporate the remunerations that individuals receive not only in exchange for labor but also through other wealth-generating mechanisms. Specifically, the economic functions of the individual members of a family are extended beyond “employee” or “employer” roles in production processes, to include household financial planning, consumption behavior, and saving strategies aimed at securing financial peace of mind for those individuals and the members of their family for years to come. Linked to these manifold types of wealth-generating activities are family members’ daily interactions with what I will call “the chain of domains and markets”: the multiple domains (education, healthcare, etc.) and markets (labor market, financial market, housing market, etc.) that families navigate over the life course as they manage their work, savings, loan repayments, and consumption. In sum, the link between individual labor market remuneration and household wealth is mediated by various family-based intervening variables such as marital history, number of earners, and number of children (Randolph 1991).

Another consequence of emphasizing households and families in wealth research is the intertwining of a family’s life-course events with its economic standing. This temporal dimension of family demography includes family life-course trajectories—cohabitation, marriage, divorce, remarriage, childbirth—that are seemingly external to economic activities but that in reality have an important impact on wealth buildup and its reproduction across generations. Moreover, because the value and composition of accumulated wealth are governed, among other things, by economic resources amassed by previous generations, wealth accumulation processes transcend the boundaries of the nuclear family and involve members of the extended family such as grandparents, aunts, and uncles (O’Brien 2012; Angel 2008). The picture that emerges from this family-centered line of research is one of the family as a vital player both in the economy and in society.

Given these empirical and conceptual considerations, it is not surprising that, after decades of an almost exclusive focus on educational attainment and labor market outcomes, wealth attainment and wealth inequality have been receiving increased attention from social scientists in recent years (Spilerman 2000; Keister 2005; Wolff 2017; Piketty 2014; Killewald et al. 2017).

The primary objectives of this book are, first, to identify and contextualize the various dimensions and changing functions of personal wealth as well as the role that wealth plays in people’s lives and, second, to explore the various macro-level institutional, demographic, and socioeconomic processes that underlie the accumulation and unequal distribution of wealth in economically developed countries.

This book contends that the creation, accumulation, transmission, and depletion of personal wealth are shaped by a complex interplay of macro-level contexts and individual- and family-level attributes (e.g. age, employment status, marital history, number of siblings). Macro-level contexts include institutional and economic forces that affect the functioning of the labor, housing, and financial markets (e.g. deindustrialization, economic recessions, the rise in precarious work, financialization), and also major demographic transitions such as changes in immigration patterns, household structures, and aging. Identifying the relationships among these economic and sociodemographic processes and their distinct consequences on the accumulation and distribution of personal wealth is extremely important. Not only do these relationships hold clues to social stratification processes, but they also have a bearing on social experiences beyond the boundaries of the economic realm. Owning physical property, for example, has been linked to—and, under some circumstances, is considered an important determinant of—non-pecuniary measures of well-being. Recent studies have shown that personal wealth has a considerable impact on various measures of quality of life, including health status, life expectancy, and life satisfaction. Personal wealth also plays a notable role in some of the most important decisions people make over the life course, for example attending college, buying a house, getting married or divorced, and timing their retirement.

One of the key arguments of this book is that, since the mid-1940s, a new “wealth terrain” has emerged that has transformed the value and composition of household wealth as well as the distribution of personal wealth in the population. This period of transformation has two phases. The first phase starts after World War II and is characterized by wealth equality and the acceptance of homeownership and personal wealth as key features of a newly formed middle class. The second phase begins in the 1980s and is marked by the financialization of household wealth portfolios and the rising concentration of wealth. This new wealth terrain has altered the processes of wealth accumulation and inequality in ways that challenge the validity of a commonly shared belief about socioeconomic mobility, namely the view that economic success is a reward for one’s effort, talent, and hard work. Consequently one of the main justifications for socioeconomic inequality—that the unequal distribution of economic resources reflects differences in people’s talent, effort, and relative contributions to the well-being of society—has been drastically eroded and is no longer tenable.

These sentiments are further complicated by a seeming paradox in the rise in wealth inequality. Namely, while the unequal distribution of wealth in many rich countries has increased over the past 40 years—reaching, in some cases, levels similar to those in the early twentieth century (Piketty 2014)—this period has also witnessed the emergence of a property-owning middle class. This new propertied class includes an increasing number of households in the middle ranks of the wealth distribution that have a greater stake in the financial and real estate markets. A running theme in this book is that wealth matters more today than ever before, not simply because wealth has become disproportionately concentrated, but precisely because it is a principal source of financial security (and anxiety) for a growing number of families.

In this new economic landscape, the meaning of wealth varies considerably depending on one’s location on the wealth ladder. For the affluent elite, accumulated wealth represents economic, social, and political capital that is transferred across generations. Members of the propertied middle class, meanwhile, have come to a realization that their near-exclusive reliance on the labor market as a source of economic remuneration is no longer sufficient to maintain an adequate standard of living and that their, and their children’s, socioeconomic status is increasingly dependent on access to tangible and financial assets. Yet, while for these families wealth has become a key source of economic security and an important determinant of standard of living, the new wealth landscape has also brought mounting financial risks and liabilities in the form of rising debt driven by student loan, auto loan, mortgage, and credit card balances. Finally, for an increasing number of households, even a modest amount of wealth remains unattainable. In both absolute and relative terms, millions of households in the bottom ranks of the wealth distribution have seen their economic conditions worsening and their debt levels growing. Some segments of the population—children, students, certain ethnic and racial groups, recent immigrants, and women—are particularly vulnerable to this changing wealth terrain. These economic and social disparities are often a product of the life-course processes of cumulative advantage or disadvantage (CA/D) (Mills 1956; Merton 1995; DiPrete and Eirich 2006; Crystal et al. 2017).