WEALTHTRAJECT: Understanding Trajectories of Wealth Accumulation and Their Variability

As part of the ERC Consolidator Grant WEALTHTRAJECT, Philipp Lersch will break new ground in wealth research over the next five years, and further expand the range of high quality data collection by SOEP. WEALTHTRAJECT is the first project to comprehensively and systematically investigate diversity in long-term wealth trajectories within and between social groups.

The starting point of the project, which begins in December 2024, is the high level of wealth inequality in many countries. In order to be able to examine current trends and developments more closely, WEALTHTRAJECT will investigate wealth and deviations from typical developments over the entire life course. WEALTHTRAJECT integrates different strands of research to investigate how the variability of wealth trajectories over time arise from the interplay of saving and consumption, the receipt of transfers from parents and other family members, and (dis)investment in (un)profitable assets.

Thus, the project sets itself apart from previous wealth research, which tends to use static and average-oriented methods. WEALTHTRAJECT breaks new ground by combining longitudinal data from surveys and registers with new biographical data on wealth, making it possible for the first time to map wealth trajectories over longer periods of people’s lives. Advanced quantitative methods are used to exploit the untapped potential of this data.

WEALTHTRAJECT pursues the following goals: (i) to document variability in wealth trajectories over people’s lives; (ii) to identify intragenerational drivers of variability in wealth trajectories; (iii) to establish the intergenerational relationships between family background and wealth trajectories; and (iv) to collect novel life history data on wealth accumulation trajectories.