Wealthiest Generation

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About a month ago, this graph was making the rounds.  It purports to show that Baby Boomers are the wealthiest generation. When I saw it, I was pretty sure it was wrong.  And I was right.

Incorrect graph generational wealth

(click for larger image)

Jeremy Horpedahl writes at the Economist Writing Every Day blog. He was kind enough to do the thinking for me.  The problem is that there are a lot more baby boomers than either gen x’ers or millenials.  More people usually means greater wealth.  Sure enough, when he used per-capita rather than total wealth, the alleged problem vanished:

Correct graph generational wealth

(click for larger image)

His full article is linked above.  I encourage everyone to read and appreciate his work.  Sometimes there really are simple ways to correct economic misinformation. From the About page, “Jeremy Horpedahl is an Associate Professor of Economics at the University of Central Arkansas.”

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About Tony Lima

Retired after teaching economics at California State Univ., East Bay (Hayward, CA). Ph.D., economics, Stanford. Also taught MBA finance at the California University of Management and Technology. Occasionally take on a consulting project if it's interesting. Other interests include wine and technology.