Why Do Wealthy Parents Have Wealthy Children?

We show that family background matters significantly for children’s accumulation of wealth and investor behavior as adults, even when removing the genetic connection between children parents raising them. The analysis is made possible by linking Korean-born who were adopted at infancy Norwegian to a population panel data set with detailed information on socioeconomic characteristics. mechanism which these Korean-Norwegian adoptees assigned adoptive families known effectively random. This allows us estimate causal effects from an adoptee being raised in one type versus another.