Customer Reviews

Getting Rich: America's New Rich and How They Got That Way

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The person who ranked this a "1" obviously was looking for a "self-help" or "how to" book which this is not. It IS an excellent analysis of how America's new rich got that way--exactly what the subtitle says. The author's conclusions show that there is some--but not a lot--of wealth mobility in America (but enough to justify her research on the topic which otherwise would merely conclude that wealth is overwhelmingly inherited) and that educational attainment and religion (perhaps to the extent that a education is fundamentally valued by a religious group) are important factors in "getting rich." The book avoids the trap of conclusion by anecdote (e.g., Well, Bill Gates dropped out of college, so education must not matter) by examining the FACTS across all of American society. This is the book for you if you want to know who in America succeeds in getting rich and why. If you want "snake-oil" get-rich-quick "secrets," look elsewhere.

This is a very well conceived and executed empirical study of wealth mobility in the United States. In this academic volume, Lisa Keister, a sociology professor at Duke University, studies the determinates of wealth accumulation. The author uses twenty-year longitudinal data to investigate why some people become wealthy while others do not. Some results of this study track with conventional wisdom, e.g. adults with relatively high wealth tend to have parents with higher education. The author also finds a negative relationship between family size and adult wealth accumulation. (This tracks with Dalton Conley's findings in The Pecking Order: A Bold New Look at How Family and Society Determine Who We Become.)

Probably the most interesting finding for the general public concerns the relationship between entrepreneurship and wealth creation. Keister finds starting a business is a key avenue for many people to "get rich." Conventional wisdom is that it takes money to make money. In other words, how much money you have in the first place (or perhaps can get from your family) in order to start a business to "get rich" makes a big difference. Keister, however, blows a hole through this excuse. Not only does she find that one's prior level of wealth apparently has no causal effect on whether one starts a business, but that family income is not determinate either. The data do not appear to discriminate between types of businesses, so one could argue that prior wealth might affect business size or success. Amar Bhide in The Origin and Evolution of New Businesses, however, finds that most of the founders of Inc. 500 companies bootstrapped their companies, with a quarter of them starting with less than $5,000 and nearly half less than $50,000. Let's hope that the door to wealth creation in America through entrepreneurship remains open.

The only one getting richer from this book is the author!! Put the money in a mutual fund!