What's the actual real world evidence on that? Plenty of rich European families have been rich for hundreds of years, and I'm not talking about royalty. That kind of disproves the theory.
The ones who go broke fast are usually the ones who also got rich fast, trough luck instead of work or knowledge, like from lottery wins or speculations.
There is a lot of real world socioeconomic data on it. studies usually look at the population in terms of 20 or 25% segments. That doesn't mean it is true for the 1% or 0.1%. That said, there are lots of examples of people entering and leaving the top 1% too, so outcome isn't perfectly deterministic.
Wealth is hard to come by, but income is much more available.
Some countries have publicly available data on individual income filings.
The US provides anonymized data, but scienentist have done a lot of fancy tricks to make the family connections clear.
Raj Chetty among others have done a lot of work on US social mobility[1]. They were able to trend parent/child incomes in the US going back to 1940, and have tons of great insights.
I dont remember all of the findings off the top of my head, but one was that relative social mobility (%s) for the US have been constant over time. Another was that economic mobility out of the bottom classes is dominated by poor immigrants. It is unclear if it is genetic, personality, or culture, but children of poor immigrants out perform native born poor by an enormous factor (2-3X better IIRC)
>Wealth is hard to come by, but income is much more available.
Income is a completely different thing than wealth and those two are not always directly correlated. You can have a good income but not accumulate much wealth because all is bein eaten away by taxes and a high CoL, and you can also have a low income but still decent wealth from an inheritance for example.
And the original claim was that wealth gets lost between generations by the majority of people which I find dubious.
I think that as a practical matter, they are extremely correlated. Wealth sitting in cash loses half its value every 20 years. Physical assets require upkeep and property taxes.
In practice, if you aren't making income, you losing wealth.
That page you link says that the poor that escape poverty do so by mingling with well-off people. The poor that stay poor only mingle with other poor people. The best route to becoming rich is to look and act like the rich and hang out where they hang out.
what I meant was the top 1% is one in a hundred, and you personally know some people that are at that income and wealth percentile, don't you?
however for the 1 in 10_000 you may or may not know people in that tier and for the 1 in 100_000 let alone 1 in 1_000_000 you are close to that tier or part of it to personally know them (in such a way that they know you).
It's complicated. Not all wealth is public. Only the wealth of the individuals who's wealth is tied to publicly traded companies: Musk, Bezos, Zuck, etc.
But we also have all those royal families from Europe and the Middle East, dictators like Putin, etc. whos' wealth are secret and very well hidden through crown estates, trusts, shell companies, all through Caribbean off-shores and often under different names. The best you have for those people is guestimations and some leaks from the Panam Papers to get an idea.
Are all decedents rich, or just a small fraction? Even if a family line has been continued for hundreds of years, there may be hundreds or even thousands of decedents of the original members who do not have access to the line of wealth. Also many families stay wealthy by only marrying members of other wealthy families. Marrying outside of the ruling class results in rapid dilution of power.
I usually see this statistic about family businesses. In the USA a family business passing through 3 generations is rare.
My personal observation is that the 4 generation has so many better options than the family business is holding them back with responsibility and the family unity has broken down through generational grudges.
That's losing their wealth, not becoming trapped in poverty. Wealth (as in hard cash) is fleeting. The behaviors that create wealth are not. I truly contend that, in America at least (what I'm familiar with), everyone can achieve a solid life. You might not be wealthy, but you will be able to support yourself and provide for a family. People losing their wealth does not mean they become destitute, nor should it. It just means they fall into a more 'normal' cohort.
That study was done by the Williams Group. Although it is widely cited across many popular news sites, it is surprisingly impossible to find the original study. Also, there's also almost no information about the Williams Group out there. No, Wikipedia page, for instance. Their web site says they do: "Government Relations, Public Affairs, Lobbying"
The ones who go broke fast are usually the ones who also got rich fast, trough luck instead of work or knowledge, like from lottery wins or speculations.