Racial Wealth and Economic Equity

IASP's work around racial wealth and economic equity demonstrates that inequality is not merely about access to resources and assets—rather, similar accomplishments in homeownership, income, and college education convert to financial gain differentially by race. This is because substantial racial wealth gaps among younger adults grow dramatically over the life course as white families leverage their head-start assets.

Findings like this emphasize the importance of policy changes rather than behavioral changes in the broader effort to build an inclusive economy. Increasingly, IASP has helped the assets field to move beyond a narrow focus on family wealth and toward broader analyses related to the impact of policies on the wealth-building opportunities of specific populations.  

As a response to larger research findings, IASP has partnered with community organizations to perform evaluations of grassroots programs which aim to close the racial wealth gap.

IASP research in Racial Wealth and Economic Equity addresses many areas including the racial wealth gap, the racial wealth audit, retirement security, middle class security, children's savings accounts, financial education and empowerment. 

Significant findings in the area of Racial Wealth and Economic Equity include:

Policy drives the racial wealth gap. 

Analysis of the Mortgage Interest Deduction, one of the largest tax benefits available to households in the U.S., shows that White households benefit disproportionately more compared to households of color. If these benefits were distributed equally, then Black Americans would receive more than twice the benefit they currently receive. 

(Accessible description of mortgage interest deduction graph)


Wealth returns to work and income are higher for white households than for households of color. 

Recent analysis on the racial wealth gap suggests that this disparity is due in large part to disparities in benefits and family wealth. The median white household with a full-time worker has over seven (7.6) times the wealth of the median black household with a full-time worker and about over five (5.4) times the wealth of a similar Latino household.

(Accessible description of employment status graph.)


Expanding college access is not a panacea for reducing racial wealth inequalities. 

Analysis of college-educated families shows that while higher educational attainment leads to greater wealth for households in general, young black households are more likely than their white peers to take on student loan debt and that wealth disparities are substantial among college-educated white and black Households.

(Accessible description of the wealth gap graph)

Racial Wealth Audit™

IASP research has notably revealed the importance of policy as a key driver of widening racial and ethnic wealth inequalities, highlighting that policy can both exacerbate and combat wealth disparities. Some well-intentioned policies have had unwittingly negative impacts on the racial wealth gap. Frequently, policy impacts on the racial wealth gap are and have been unintended consequences of policy design, rather than being explicitly part of policy efforts.

The Racial Wealth Audit™ serves as a policy analysis tool to help better understand how a policy or program may impact the racial wealth gap. We have designed it for multiple audiences and uses including: 1) assessing policy proposals; 2) analyzing current policy; 3) assisting policy design by locating the ‘sweet spot’ features that close the gap; 4) examining institutional reforms; and 5) interrogating narratives that purport to explain the main causes of racial inequality, such as personal responsibility, marriage, child-bearing, and conspicuous consumption.

Given the value of bringing a racial wealth analysis frame to policy deliberations, the Racial Wealth Audit™ is an important new framework and empirical tool. This tool facilitates constituency, organizational, advocate, and policymaker equity-based engagement in the policy process and public debate. The Racial Wealth Audit™ helps to bring to the forefront how policy affects disparities in wealth by race, a much needed but thus far, often overlooked equity perspective.