Understanding Trajectories of Wealth Accumulation and Their Variability (WEALTHTRAJECT)

WEALTHTRAJECT is the first project to comprehensively and systematically examine diversity in long-term trajectories of wealth accumulation within and between social groups.

Wealth inequality is on the rise in many affluent societies. It is time to move beyond prevailing static snapshots of average wealth inequality between people to understand this trend. Instead, a dynamic perspective on wealth changes experienced by people over their lifetimes is needed. This dynamic perspective reveals how diverse the trajectories of wealth accumulation are, i.e., the degree of trajectory variability.

WEALTHTRAJECT integrates disconnected strands of literature to study how variability in trajectories emerges over time through the interplay of saving and spending of income, receipt of transfers from parents and other family members, and (de-)investment in (un-)profitable assets.

WEALTHTRAJECT addresses four main innovative objectives: (i) to document variability in wealth trajectories over people’s lives; (ii) to identify intragenerational drivers of variability in wealth trajectories; (iii) to establish the intergenerational relationships between family background and wealth trajectories; (iv) to collect novel life history data on wealth accumulation trajectories.

To address these objectives, WEALTHTRAJECT innovates by adopting a novel approach emphasising the diverse patterns of wealth gains and losses in people’s lives. The project challenges the prevalent idea of a uniform hump-shaped life cycle accumulation pattern in wealth.

WEALTHTRAJECT breaks new ground by combining longitudinal data from surveys and registers and original life history data on wealth that, for the first time, allow the mapping of wealth trajectories over extended periods of people’s lives. Advanced quantitative methods are applied to leverage the untapped potential of these data.

Funding agency: European Research Council (ERC)

Funding period: December 2024-2029

Demographic Change and the Intergenerational Persistence in Homeownership in Europe (DECIPHE)

The family of origin is crucial to overcome barriers to homeownership for young people. Specifically, parental homeownership increases the chances of offspring’s homeownership. Demographic changes bear on this intergenerational persistence, but how the transmission is affected is unclear. For instance, increasing life expectancies may reduce the resources that can be transferred for homeownership across generations. In contrast, low fertility in the parental generation may reduce the number of siblings competing for these resources. DECIPHE is the first project to comprehensively study whether and how profound demographic changes in Europe impact the intergenerational persistence of homeownership, considering variations across countries, regions, and birth cohorts.

We adopt a life course framework on housing tenure, in which individuals’ homeownership is shaped by their household members’ preferences and resources and contextual factors, including housing markets, cultural norms, and welfare institutions. Demographic changes related to romantic unions, fertility, mortality, and migration can impact the persistence of homeownership by affecting the degree of support from the parental generation and the preferences, opportunities, and constraints for entering homeownership in the offspring generation.

We apply a comparative research design covering all EU member states. We zoom in on four focus country cases: Germany, Hungary, Spain, and the UK. We will draw on available longitudinal data in combination with newly collected survey data, including survey experiments, and a novel contextual database. Our empirical results will inform a microsimulation model on the demographic conditions of the intergenerational persistence for predicting future scenarios.

Further information can be found on the project website.

Funding agency: Volkswagen Foundation

Funding period: June 2024-2028

The intergenerational reproduction of wealth inequality and its socio-demographic conditions in Germany (INTERVERM)

Wealth inequality has reached historically high levels in many rich democracies. Intergenerational wealth reproduction that cause adult children to occupy similar wealth positions compared to their parents at a similar age are particularly relevant to understanding the emergence of inequalities. In addition to direct wealth transfers, there are also crucial indirect processes of reproduction, e.g. investing in children’s education. We expect that the reproduction of wealth is critically influenced by socio-demographic conditions, i.e. socially structured partner choice, fertility, and mortality.

Therefore, this project uses a multi-generational life course perspective to investigate the intergenerational wealth reproduction and its socio-demographic conditions in Germany, taking gender differences into account. Specifically, the project pursues the goals of (1) comprehensively describing the extent of intergenerational wealth reproduction in Germany, (2) comparing the extent of wealth reproduction in Germany internationally, (3) identifying the relevant socio-demographic conditions of wealth reproduction for the next generation from the parents’ perspective, (4) identifying the relevant socio-demographic conditions of wealth reproduction from the children’s perspective, and (5) describing and explaining the gender differences in wealth reproduction in Germany.

Secondary data from the Socio-economic Panel (SOEP) for five waves are used. A sustainable improvement of the data infrastructure for wealth in Germany is achieved by making wealth data for 1988 from the SOEP publically accessible. The data are analysed using combined retrospective and prospective approaches. The combination of both approaches enables the generation of complementary knowledge about wealth reproduction. We mainly apply multi-level models to estimate sibling correlations and intergenerational correlations in wealth and apply modern methods of longitudinal analysis such as marginal structural models with inverse probability of treatment weighting. The results from Germany are compared internationally through parallel analyses for the USA.

The project creates new knowledge about the rigidity of the German social structure and the influence of socio-demographic processes on the reproduction of inequality over time. This knowledge can generate important social policy implications.

Funding agency: German Research Foundation (DFG)

Funding period: 2021-2026

Accumulation of Personal Wealth in Couples: Individual Resources and Gender Inequalities in Intimate Relationships (MYWEALTH)

This project examines personal wealth of individuals within heterosexual couples. Wealth is an economic resource that provides many advantages that go beyond income. Particularly, personal wealth, which needs to be distinguished from household wealth, is increasingly important to provide economic security over the life course. This is a consequence of less stable intimate relationships and restructuring welfare states. Previous research has established that women mostly own less personal wealth in couples. Thorough examinations of the processes underlying personal wealth accumulation that create gender inequalities within couples are missing, however.

To fill this gap the proposed project answers the following overarching research question: What shapes the accumulation of and inequalities in personal wealth in couples? By answering this question, the project’s first aim is to understand how being in a couple affects personal wealth accumulation for women and men. Second, it aims to improve on the knowledge about the generation of economic inequalities within couples over time. Third, it aims to identify contextual conditions that moderate the within-couple accumulation of wealth. The project builds on theories of the intra-household distribution of resources in combination with a life course perspective. The main working hypothesis is that well-known processes of accumulation at the household-level have gendered, and so far little understood, effects for personal wealth of partnered women and men. It is also hypothesised that these processes differ across countries, e.g. due to divergent tax systems.

To test this, the accumulation of personal wealth is examined from multiple perspectives and by observing individuals within couples over time and in diverse countries. First, quantitative, secondary and longitudinal survey data from Australia, Germany, the UK and US are used. The data are comparatively analysed using empirical models of growth and change and models that capture biographical complexities. Second, these analyses are amended with factorial survey experiments on the subjective attitudes towards personal wealth in couples in all four country cases. These primary data are analysed with multilevel models. The integration of results from both analytical parts allows for comprehensive answers to the overarching research question.

Thereby, this timely and relevant project contributes to a better understanding of women’s and men’s unequal life chances due to wealth disparities.

Funding agency: German Research Foundation (DFG)

Funding period: 2017-2023 (completed)