Wealth inequality has always been part of American life, but not until recently has it risen to a level not seen since the Great Depression. In this dissertation, I present three essays in which the wealth gap issue is investigated in depth from three different perspectives.

In two linked papers I show the importance of fertility to the wealth distribution and how fertility interacts with intergenerational transfer taxation. In a third paper I empirically explore the impact of recession on occupational sorting, using public school teachers as a relatively acyclical comparison occupation.

This doctoral dissertation is divided in three chapters. All of them deal with aspects related to the measurement of economic inequality, but each one has a distinct topic and puts its focus on a specific standpoint. Inheritances and Wealth Inequality: A Machine Learning Approach. This chapter explores the relationship between received inheritances and the distribution of wealth (financial, non-financial and total) in four developed countries: the United States, Canada, Italy and Spain. We follow the inequality of opportunity (IOp) literature and -considering inheritances as the only circumstance- we show that traditional IOp approaches can lead to non-robust and arbitrary measures of IOp depending on discretionary cut-off choices of a continuous circumstance such as inheritances. Overcoming this limitation, we apply Machine Learning methods to optimize the choice of cut-offs (‘random forest’ algorithm) and we find that IOp explains over 60% of wealth inequality in the US and Spain (using the Gini coefficient), and more than 40% in Italy and Canada. Including parental education as an additional circumstance -available for the US and Italy- we find that inheritances are still the main contributor. Finally, using the S-Gini index with different parameters to weight different parts of the distribution, we find that the effect of inheritances is more prominent at the middle of the wealth distribution, while parental education is more important for the asset-poor...

Racial inequality and wealth are inextricably linked. Wealth gaps are an important dimension of racial inequality. In addition, wealth itself plays a causal role in other dimensions of inequality, including unequal labor market and education outcomes. In the first essay, I estimate the effect of access to extended family wealth on college enrollment and I find a positive relationship. This is important for higher education policies that aim to reduce inequality but fail to account for race and wealth. In the second essay, I estimate the effect of Medicaid on individual assets. Whereas economic theory in the literature predicts a negative effect, I develop a framework that shows how public insurance can increase savings and I present empirical evidence against a negative effect. Finally, the third essay develops an analytical framework called Latinx stratification economics by reviewing the main economic theories applied to Latinxs and demonstrating how stratification economics and Latinx studies may be used to critique the dominant theories.