Financial Inclusion Across the United States

40 Pages Posted: 6 Dec 2021

See all articles by Motohiro Yogo

Motohiro Yogo

Princeton University - Department of Economics; National Bureau of Economic Research

Andrew Whitten

U.S. Department of the Treasury - Office of Tax Analysis (OTA)

Natalie Cox

Princeton University - Department of Economics

Date Written: December 3, 2021

Abstract

We document new facts about bank and retirement account participation, based on the universe of U.S. households with a member aged 50 to 59 in administrative tax data. Financial participation is much higher than that reported in survey data, especially for low-income households. However, financial participation declines among low-income households from 2008 to 2018. Geographic variation in financial participation relates to income rather than racial composition or access to financial services. Based on instrumental variables, we estimate a large impact of access to employer retirement plans on retirement account participation for low- and middle-income households.

Keywords: Financial participation, Household finance, Inequality, Racial disparities, Tax policy

JEL Classification: D14, G51

Suggested Citation

Yogo, Motohiro and Whitten, Andrew and Cox, Natalie, Financial Inclusion Across the United States (December 3, 2021). Available at SSRN: https://ssrn.com/abstract=3934498 or http://dx.doi.org/10.2139/ssrn.3934498

Motohiro Yogo (Contact Author)

Princeton University - Department of Economics ( email )

Julis Romo Rabinowitz Building
Princeton, NJ 08544
United States

HOME PAGE: http://sites.google.com/site/motohiroyogo/

National Bureau of Economic Research

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Andrew Whitten

U.S. Department of the Treasury - Office of Tax Analysis (OTA) ( email )

1500 Pennsylvania Ave., N.W.
Washington, DC 20220
United States

HOME PAGE: http://andrewwhitten.com

Natalie Cox

Princeton University - Department of Economics ( email )

Princeton, NJ 08544-1021
United States

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