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Tuesday, October 25, 2016

August 8 (Bloomberg) — Americans pride themselves on their intergenerational mobility. Our nation’s exceptionalism is organized around the American dream: No matter where you come from and no matter who your parents are, you can rise to the top of the economic ladder, so long as you are willing to commit yourself and work hard.

In recent years, however, a great deal of comparative research has been done on intergenerational mobility, and it raises legitimate questions about the claim that the U.S. stands out as a land of opportunity. In 2006, a widely reported study found that in terms of intergenerational mobility, the U.S. lagged behind Nordic nations (including Denmark, Finland, Sweden and Norway) as well as the U.K. For example, Danish men born to households in that nation’s bottom quintile are far more likely than their U.S. counterparts to make it to the higher quintiles.

A comprehensive study published in July found that the U.S. shows less intergenerational mobility than do a number of other countries, including Germany, New ZealandCanadaAustraliaFrance and Japan. The U.S. is marked by a degree of “stickiness” in the top and bottom 10 percent. If an American is born to poor parents, he has a decent chance of staying poor, and if his parents are wealthy, it is a pretty good bet that he will end up in the economic elite.

However illuminating, the data raise many questions. The U.S. is a big country, and the aggregate numbers don’t tell us about variations across states.

Southeast Lags

Does the reality of the American dream depend on whether you are born in Mississippi, ColoradoKentucky or New Hampshire? The answer would help us to establish what, exactly, is the source of the problem. It could also help us to identify some responses.

Harvard University economist Raj Chetty and his co-authors have started to provide such an answer. The big news is that intergenerational mobility is indeed variable across regions, states and cities. If you are born in Pittsburgh, Boston, San Francisco, Minneapolis or New York, you have a fair chance of getting to the top fifth of the income distribution, even if you start out in the bottom fifth. But in other cities — such as Atlanta; Charlotte; Nashville, Tennessee; and Raleigh, North Carolina — children who are born into the bottom fifth are significantly more likely to get stuck.

The state-by-state data suggest an even more vivid picture. In almost all of the West, there is a high degree of intergenerational mobility. The Northeast and the Southwest also look pretty good. In the Midwest, the picture is more mixed, with generally high levels of mobility in Minnesota, Nebraska and North Dakota but disturbingly low levels in some cities, including Detroit, Indianapolis and Columbus, Ohio.

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  • Sand_Cat

    What a surprise!
    The reddest of the red states, where racism and lack of respect for education (and the corresponding lower per-pupil spending on it) are the highest, economic mobility is the lowest.
    And I know it said the variation doesn’t appear to be by race – so please, trolls, don’t try that one – but the correlation still includes racism.

    • Vazir Mukhtar

      Read about what Tennessee (no link in the article) is doing/has done about education and other factors that influence economic mobility. Read also about Alabama (not mentioned) has done/is doing about economic mobility.

      No, neither has achieved miracles; both, however, have taken/are taking significant steps to address problems that have plagued both states for more than a century.

      Yes, racism is still a factor. One major difference between the racism in the South and that in parts of the North is that one is obvious, the other is subtle.

      And no, I live in neither state but do have investments there. When an employer treats employees fairly, and they make quality products, or deliver first-rate services, everyone prospers — the employer, the employees, and the share holders.

      • Sand_Cat

        Don’t mean to be nasty, but your “investments” mean less than nothing. Yes, IF the employer treats people fairly, all do a little better. The IF is the big question. The bigger question is that if they’re dealing with a workforce crippled by the ignorance that passes for education in these states, what is “fair”? Hopefully you’re right about progress, but it obviously is in your own interest to convice yourself you’re not investing in racist, exploitive enterprises, even though lack of worker protection laws and lack of enforcement of what there are is what makes investment in these areas attractive to those who don’t care about such things.
        And yes, northern racism is more subtle: it rarely makes it into the law, something that cannot be said for southern.

        • Vazir Mukhtar


          Even before the Civil Rights Movement of the 1960s I’ve been concerned with the plight of the working and middle classes in the South. I have relatives there and have seen for myself how benighted many people are.

          I play but a small part in improving education, plus living and working living conditions by supporting organizations whose purpose includes those areas as well as various types of discrimination. My investments are in enterprises endorsed by progressive religious and secular groups.

          I am perhaps “touchier” than I should be about problems in the South. Yet when I remember how dreadful things were 60 years ago, it does seem that there’s been progress. I believe you and I are on the side of the angels; for we both know how much still needs to be done.

          • Sand_Cat

            Yes, I grew up in SC. I’ve never forgotten my mother’s saying one of the neighbors had a “boy” helping him in the yard when I saw a man older than my father.
            I think we all hope there’s been progress, and no doubt there has, but the swift reaction to the removal of the teeth from the Voting Rights act gave abundant proof there is a very long way to go.

          • Vazir Mukhtar

            Agreed. I remember when my father told me in the early 70s that for the first time he’d seen a large number of blacks in the line to vote. You know, of course, that NC’s governor has just signed what is said to be the most repressive voting act in the country. I’m eagerly awaiting the first court challenge. It can’t come too soon.

  • Lynda Groom

    Look to the state houses and the legislatures for guidance on the matter. These folks keep voting against their old-self interest. Those holding them back keep feeding them the talking points and talking about ‘freedom’ and they continue to lap it up. When will they learn? I’ve family in Jacksonville, Fla and they still stand firmly with the forces that are oppressing them to this day.

  • TZToronto

    It’s interesting that the article mentions mobility from quintile to quintile but mainly in terms of upward mobility. If someone from the lowest quintile moves to the top quintile, that means that someone in the top quintile may have been pushed out, downward. Of course, we assume that a growing population can make the quintiles larger. (That is, with a population of 100 million, each quintile is 20 million. With a population of 120 million, each quintile is 24 million.) The bottom line is that mobility cannot all be in the upward direction; when someone moves up, someone else moves down. The questions may be these: Are we really talking about quality of life or simply a statistical movement from one economic stratum to another? Is quality of life in the lowest quintile as bad as it’s always been, or is everyone moving up (e.g., the poorest people didn’t have TVs in the ’60s, but they have them now)? And are the attributes of the quintile members comparable from generation to generation? (The top quintile now contains millions of ordinary millionaires and a small number of super-rich billionaires. So should we even be talking about quintiles?)

    This is not to question the essence or implications of the findings.

  • Budjob

    Oppression is oppression,regardless if it is at the barrel of a gun pointed at you,laws that enhance business interests at the expense of the poor,minorities,and the middle class and more importantly politicians that coerce people by misleading them.Oppression,is oppression,is OPPRESSION!!

  • charleo1

    It’s simple really. When you run your State like a criminal enterprise, criminals get
    the loot. And everybody else gets scammed. It’s boils down to priorities. If you
    invest in people, you get progress. If you hand tax payer money over to the well
    connected, good old boy network, come election time, they’ll have your back.
    Drive their roads sometime. It will tear your undercarriage up. Breathe the air in
    Texas City, look at the disgusting condition of the bridges in Oklahoma. Look up
    the number of students graduating High School, and going on to a secondary Ed.
    Or, research the number of their citizens without health insurance, or a regular
    doctor. Or, despite their rhetoric, the amount of Federal dollars they soak up,
    because, their Right To Work Laws, help produce the highest rates of poverty in
    the Country. And look at their budgets, as they rob Peter, to pay Paul, then lie
    to Peter. They refuse to tax the people with money, and poor have nothing to tax.
    It’s simple really.

  • derbradster

    There is a concept called the crab bucket. One tries to climb up and out and others pull him back down. Upward advancement might then be seen by family friends peers as some type of betrayal. Consider the slur terms oreo, coconut for minorities who aspire to pursue interests/accomplishments deemed to be too caucasian.