Racial and Ethnic Differences in the Relationship between Income Inequality and Family Structure: A Cohort Analysis

Christine Percheski, Princeton University

Income inequality in the United States has been on the rise since the early 1970s. Previous research suggests that changes in family structure can account for some of this increase, but estimates vary widely and few analyses disaggregate by race or birth cohort. Moreover, much of the previous research has made strong assumptions about how family structure affects employment levels and wage rates and assume homogenous effects across racial and ethnic groups. In this paper, I produce a range of estimates that show how much of the increase in income inequality is related to changes in family structure under different assumptions about how family structure affects employment and earnings. I consider how this varies across four racial/ethnic groups – non-Hispanic whites, non-Hispanic blacks, Hispanics, and others - for working-age adults from birth cohorts born 1935-1970.