The enduring importance of family wealth: Evidence from the Forbes 400, 1982 to 2013

The richest 1 percent in the United States is a largely unexplored group, despite its ever-increasing share of the national wealth. The Forbes roster of the richest Americans has often been used to demonstrate the fading of nineteenth-century hereditary fortunes. Based on full panel data from the annual American Forbes 400 ranking (1982-2013), this article goes beyond previous work by examining not only the sources of the very wealthy but also the factors that increase or decrease the likelihood of remaining listed among the American super-rich and the typical patterns of mobility. We find that heirs are more likely to remain listed in the Forbes 400 roster than self-made entrepreneurs, all other things being equal. While scions of great wealth are less likely to drop completely from the list, they are nevertheless more likely to fall gradually in ranking than are self-made multimillionaires. Even though entrepreneurship matters increasingly for becoming super-rich, we conclude that it is first and foremost the ability of rich family dynasties to retain control over corporations and to access sophisticated financial advice that makes fortunes last.