Race and Economic Well-Being in the United States

We construct a measure of consumption-equivalent welfare for Black and White Americans that incorporates life expectancy, incarceration, consumption, leisure, and inequality. Based on this incomplete list of factors, welfare for Black Americans was 40% of that for White Americans in 1984 and rose to 59% by 2022. Our measure of Black welfare increased by a factor of 3.5, whereas aggregate consumption per person only doubled. Despite this remarkable progress, the welfare gap between Black and White Americans remains disconcertingly large at 41% in 2022, much larger than the 16% gap in consumption per person across Black and White individuals.