Left Behind: Partisan Identity and Wealth Inequality

52 Pages Posted: 4 Jun 2019 Last revised: 15 Jun 2022

See all articles by Da Ke

Da Ke

University of South Carolina - Department of Finance

Date Written: May 29, 2022

Abstract

This paper investigates whether and how opposing partisans differ in their wealth accumulation. Using microdata from a longitudinal U.S. household survey, I document that Democrats are less likely than Republicans to participate in the stock market. Moreover, the partisan gap widens sharply under Democratic presidencies, precisely when the stock market returns are substantially higher. This dynamic pattern accounts for more than half of the discrepancy in wealth accumulation between Democrats and Republicans over presidential cycles. Further investigation suggests the importance of partisan identity. In the U.K. context, I find similar results on a sample of Labour and Conservative partisans.

Keywords: partisan identity, wealth inequality, political cycles, stock market participation

JEL Classification: D31, G40, G51

Suggested Citation

Ke, Da, Left Behind: Partisan Identity and Wealth Inequality (May 29, 2022). Available at SSRN: https://ssrn.com/abstract=3384406 or http://dx.doi.org/10.2139/ssrn.3384406

Da Ke (Contact Author)

University of South Carolina - Department of Finance ( email )

1014 Greene Street
Columbia, SC 29208
United States

HOME PAGE: http://www.dakefinance.com

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