Premium
Understanding the Racial/Ethnic Gap in Bank Account Ownership among Older Adults
Author(s) -
Blanco Luisa R.,
Angrisani Marco,
Aguila Emma,
Leng Mei
Publication year - 2018
Publication title -
journal of consumer affairs
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.582
H-Index - 62
eISSN - 1745-6606
pISSN - 0022-0078
DOI - 10.1111/joca.12188
Subject(s) - ethnic group , socioeconomic status , demographic economics , asset (computer security) , financial inclusion , citizenship , psychology , inclusion (mineral) , social psychology , political science , business , economics , financial services , demography , sociology , finance , politics , population , computer security , computer science , law
The observed racial/ethnic gap in bank account ownership among older adults is substantial. We investigate socioeconomic, cognitive, and cultural barriers underling it. As additional potential barriers are accounted for, the residual gaps in financial inclusion with respect to Whites are reduced by 19% for blacks and 46% for Hispanics. We find that citizenship and “taste for privacy” play a limited role for both minority groups, while real asset ownership, health, cognitive ability, and cultural hurdles contribute substantially to the gap. For Hispanics, language barriers explain most of the gap, while neighborhood‐level socioeconomic characteristics are more salient for blacks. We also examine how the racial/ethnic composition of couples influences financial decisions. We estimate a significantly smaller residual gap between “mixed” and white couples than between minority and white couples. We provide empirical evidence suggesting that, other things equal, mixed couples are less concerned with the cultural/psychological barriers facing minority couples.