Race and Consumption: Black and White Disparities in Household Spending

Abstract

Differences in consumption patterns are usually treated as a matter of preferences. In this article, the authors examine consumption from a structural perspective and argue that black households face unique constraints restricting their ability to acquire important goods and services. Using data from the Consumer Expenditure Surveys, the authors examine racial differences in total spending and in spending on major categories of goods and services (food, transportation, utilities, housing, health care, and entertainment). The authors also capture heterogeneous effects of racial stratification across class by modeling racial consumption gaps across household income levels. The results show that black households tend to have lower levels of total spending than their white counterparts and that these disparities tend to persist across income levels. Overall, these analyses indicate that racial disparities in consumption exist independently of other economic disparities and may be a key unexamined factor in the reproduction of racial inequality.