Socioeconomic mobility in the United States

Last updated

Illustration from a 1916 advertisement for a vocational school in the back of a US magazine. Education has been seen as a key to socioeconomic mobility, and the advertisement appealed to Americans' belief in the possibility of self-betterment as well as threatening the consequences of downward mobility in the great income inequality existing during the Industrial Revolution. Going up or down advertisement.jpg
Illustration from a 1916 advertisement for a vocational school in the back of a US magazine. Education has been seen as a key to socioeconomic mobility, and the advertisement appealed to Americans' belief in the possibility of self-betterment as well as threatening the consequences of downward mobility in the great income inequality existing during the Industrial Revolution.

Raj Chetty... ha[s] pieced together an astonishing series of findings: that absolute mobility (the chance that a child will go on to earn more than their parents) has dropped from 90%, a near certainty, to 50%, a coin-toss; that the gap in life-expectancy between rich and poor has widened even as that between blacks and whites has narrowed; and that although the chances of upward mobility differ greatly from one neighbourhood to the next, in nearly every part of America the path for black boys is steeper.

Contents

— The Economist , 2020 [1]

Socioeconomic mobility in the United States refers to the upward or downward movement of Americans from one social class or economic level to another, [2] through job changes, inheritance, marriage, connections, tax changes, innovation, illegal activities, hard work, lobbying, luck, health changes or other factors.

This mobility can be the change in socioeconomic status between parents and children ("inter-generational"); or over the course of a person's lifetime ("intra-generational"). Socioeconomic mobility typically refers to "relative mobility", the chance that an individual American's income or social status will rise or fall in comparison to other Americans, but can also refer to "absolute" mobility, based on changes in living standards in America. [3]

Several studies have found that inter-generational mobility is lower in the US than in some European countries, in particular the Nordic countries. [4] [5] The US ranked 27th in the world in the 2020 Global Social Mobility Index. [6]

Social mobility in the US has either remained unchanged or decreased since the 1970s. [7] [8] [9] [10] [11]

A 2008 study showed that economic mobility in the U.S. increased from 1950 to 1980, but has declined sharply since 1980. [12] A 2012 study conducted by the Pew Charitable Trusts found that the bottom quintile is 57% likely to experience upward mobility and only 7% to experience downward mobility. [13] A 2013 Brookings Institution study found income inequality was increasing and becoming more permanent, sharply reducing social mobility. [14] A large academic study released in 2014 found US mobility overall has not changed appreciably in the last 25 years (for children born between 1971 and 1996), but a variety of up and down mobility changes were found in several different parts of the country. On average, American children entering the labor market today have the same chances of moving up in the income distribution (relative to their parents) as children born in the 1970s. [15] [16]

Many Americans strongly believe the U.S. is a "Land of Opportunity" that offers every child an equal chance at social mobility and economic mobility. The idea of Americans rising from humble origins to riches has been called a "civil religion", [4] "the bedrock upon which the American story has been anchored", [17] and part of the American identity (the American Dream [18] ) This theme is celebrated in the lives of famous Americans such as Benjamin Franklin and Henry Ford, [4] and in popular culture (from the books of Horatio Alger and Norman Vincent Peale to the song "Movin' on Up" [19] ).

In the US only 32% of respondents agreed with the statement that forces beyond their personal control determine their success. In contrast, a majority of European respondents agreed with this view in every country but three (Britain, the Czech Republic and Slovakia). [8] The Brookings Institution found Americans surveyed had the highest belief in meritocracy—69% agreed with the statement "people are rewarded for intelligence and skill"—among 27 nations surveyed. [20]

Another report found such beliefs to have gotten stronger over the last few decades. [21]

Intergenerational mobility

If Americans want to live the American dream, they should go to Denmark.

—  Richard G. Wilkinson at a 2011 TED conference on economic inequality. [22]

Current state

The correlation between parents' income and their children's income in the United States is estimated between .4 and .6. [23]

If a parent's income had no effect on a child's opportunity for future upward mobility, and was not correlated with other factors impacting it, approximately 20% of poor children who started in the bottom quintile (in the bottom 20% of the US range of incomes) would remain there as poor adults. At the other end of income spectrum, if children were born into wealthy families in the top 20%, only 20% would stay in that top income category if their mobility opportunities were equal to every other child's in the country.

But long-term income statistics show this isn't happening. Mobility opportunities are different for poor and wealthy children in the US. Parental incomes and parental choices of home locations while raising children appear to be major factors in that difference. According to a 2012 Pew Economic Mobility Project study [24] 43% of children born into the bottom quintile (bottom 20%) remain in that bottom quintile as adults. Similarly, 40% of children raised in the top quintile (top 20%) will remain there as adults. Looking at larger moves, only 4% of those raised in the bottom quintile moved up to the top quintile as adults. Around twice as many (8%) of children born into the top quintile fell to the bottom. [24] 37% of children born into the top quintile will fall below the middle. These findings have led researchers to conclude that "opportunity structures create and determine future generations' chances for success. Hence, our lot in life is at least partially determined by where we grow up, and this is partially determined by where our parents grew up, and so on." [25]

Economic mobility may be affected by factors such as geographic location, education, [26] genetics, [27] culture, race, sex, and interactions among these, [28] as well as family wealth. [29]

Famous historical cases

Famous instances of great economic and social mobility include Benjamin Franklin and Henry Ford. [4] Additional popular examples of upward social mobility between generations in America include Abraham Lincoln and Bill Clinton, who were born into working-class families yet achieved high political office in adult life. Andrew Carnegie arrived in the U.S. as a poor immigrant and rose to become a steel tycoon, perhaps the wealthiest man in America, and its leading philanthropist.

Comparisons with other countries

Intergenerational income elasticities for nine developed countries (showing the fraction of children from poor families who grow up to be poor adults) Intergenerational mobility graph-1.jpg
Intergenerational income elasticities for nine developed countries (showing the fraction of children from poor families who grow up to be poor adults)

Several large studies of mobility in developed countries in recent years have found the US among the lowest in mobility. [4] [21] One study (“Do Poor Children Become Poor Adults?") [21] [30] [31] found that of nine developed countries, the United States and United Kingdom had the lowest intergenerational vertical social mobility with about half of the advantages of having a parent with a high income passed on to the next generation. The four countries with the lowest "intergenerational income elasticity", i.e. the highest social mobility, were Denmark, Norway, Finland, and Canada with less than 20% of advantages of having a high income parent passed on to their children. (see graph) [21] Nobel Prize-winning economist Joseph Stiglitz contends that "Scandinavian countries changed their education systems, social policies and legal frameworks to create societies where there is a higher degree of mobility. That made their countries more into the land of opportunity that America once was." [32]

According to journalist Jason DeParle, "At least five large studies in recent years have found the United States to be less mobile than comparable nations. A project led by Markus Jantti, an economist at a Swedish university, found that 42 percent of American men raised in the bottom fifth of incomes stay there as adults. That shows a level of persistent disadvantage much higher than in Denmark (25 percent) and Britain (30 percent)—a country famous for its class constraints. [33] Meanwhile, just 8 percent of American men at the bottom rose to the top fifth. That compares with 12 percent of the British and 14 percent of the Danes. Despite frequent references to the United States as a classless society, about 62 percent of Americans (male and female) raised in the top fifth of incomes stay in the top two-fifths, according to research by the Economic Mobility Project of the Pew Charitable Trusts. Similarly, 65 percent born in the bottom fifth stay in the bottom two-fifths. [4] [34]

Intergenerational immobility versus economic inequality in 2012. Countries closest to the axis in the left bottom have the highest levels of socio-economic equality and socio-economic mobility. The Great Gatsby Curve.png
Intergenerational immobility versus economic inequality in 2012. Countries closest to the axis in the left bottom have the highest levels of socio-economic equality and socio-economic mobility.

In 2012, a graph plotting the relationship between income inequality and intergenerational social mobility in the United States and twelve other developed countries—dubbed "The Great Gatsby Curve" [35] —showed "a clear negative relationship" between inequality and social mobility. [36] [37] Countries with low levels of inequality such as Denmark, Norway and Finland had some of the greatest mobility, while the two countries with the high level of inequality—Chile and Brazil—had some of the lowest mobility. The curve was introduced in a speech by chairman of the Council of Economic Advisers Alan Krueger, [36] and the President's Economic Report to Congress. [38]

Philip Alston, the United Nations special rapporteur on extreme poverty and human rights, asserted in a 2017 report on an investigation of extreme poverty in the United States that "The American Dream is rapidly becoming the American Illusion since the US now has the lowest rate of social mobility of any of the rich countries." [39]

Absolute mobility

Even though mobility has gone down, most Americans still have more income than their parents. A 2007 study "Economic Mobility Project: Across Generations", using Panel Study of Income Dynamics, found 67% of Americans who were children in 1968 had higher levels of real family income in 1995–2002 than their parents had in 1967–1971 [40] (although most of this growth in total family income can be attributed to the increasing number of women who work since male earnings have stayed relatively stable throughout this time [40] ) As to whether this figure is higher or lower than other countries is difficult to say as this type of measure has not been done for other countries. [40]

Intragenerational mobility

Another form of mobility—"intra-generational"—is the change in class and/or income experienced by individuals during their lifetime. Intra-generational mobility renders the meaning of "short-term" inequality ambiguous, since high intra-generational mobility suggests that those who are currently less well-off (for instance the young) will move up the class or income scale later in life.

How strong Intra-generational mobility is in the US is disputed. [41] Supporting relatively high levels of intragenerational mobility, Thomas A. Garrett [42] reported on a US Treasury study of income mobility from 1996 to 2005. This found "There was considerable income mobility of individuals in the U.S. economy during the 1996 through 2005 period as over half of taxpayers moved to a different income quintile over this period"; 80 percent of taxpayers had incomes in quintiles as high or higher in 2005 than they did in 1996, and 45 percent of taxpayers not in the highest income quintile moved up at least one quintile. [43] Fewer than half (between 40 and 43%) "of those in the top 1 percent in 1996 were still in the top 1 percent in 2005. Only about 25 percent of the individuals in the top 1/100th percent in 1996 remained in the top 1/100th percent in 2005." The study reassured Americans "the opportunity for upward mobility" in America despite their concern about the "long-term trend of increasing income inequality in the U.S. economy" After-tax income of the top 1% earners has grown by 176% percent from 1979 to 2007 while it grew only 9% for the lowest 20%.

However others describe the data as reflecting less mobility. A 2007 inequality and mobility study by Wojciech Kopczuk and Emmanuel Saez found the pattern of annual and long-term earnings inequality "very close", and the population at top income levels in America "very stable" and had "not mitigated the dramatic increase in annual earnings concentration since the 1970s." [44] A 2011 CBO study on "Trends in the Distribution of Household Income Between 1979 and 2007" also found multi-year household income distribution in America "only modestly" more equal than annual income.

Given the fairly substantial movement of households across income groups over time, it might seem that income measured over a number of years should be significantly more equally distributed than income measured over one year. However, much of the movement of households involves changes in income that are large enough to push households into different income groups but not large enough to greatly affect the overall distribution of income. Multi-year income measures also show the same pattern of increasing inequality over time as is observed in annual measures. [45]

In other words, "many people who have incomes greater than $1 million one year fall out of the category the next year—but that’s typically because their income fell from, say, 1.05 million to 0.95 million, not because they went back to being middle class." [45] [46]

Economist Paul Krugman complains that conservatives have resorted to "extraordinary series of attempts at statistical distortion" in claiming high levels of mobility.

Studies by the Urban Institute and the US Treasury have both found that about half of the families who start in either the top or the bottom quintile of the income distribution are still there after a decade, and that only 3 to 6 percent rise from bottom to top or fall from top to bottom. [41]

While in any given year, some of the people with low incomes will be "workers on temporary layoff, small businessmen taking writeoffs, farmers hit by bad weather"—the rise in their income in succeeding years is not the same 'mobility' as poor people rising to middle class or middle income rising to wealth. It's the mobility of "the guy who works in the college bookstore and has a real job by his early thirties." [41]

Causes and issues

Explanations for the relatively low level of social mobility in the US include the better access of affluent children to superior schools and preparation for schools so important in an economy where pay is tilted toward educated workers; high levels of immigration of unskilled laborers and low rate of unionization, which leads to lower wages among the least skilled; public health problems, like obesity and diabetes, which can limit education and employment; [4] the sheer size of the income gap between the rich which makes it harder to climb the proverbial income ladder when the rungs are farther apart; [47] poverty, since those with low income have significantly lower rates of mobility than middle and higher income individuals. [48] The factors which affect social mobility vary across the United States as does social mobility which in favored areas is much higher than in less favored areas. [49]

A 2022 study suggested that factors that contribute to low levels of intergenerational mobility in the United States include a disparity in returns to human capital, low levels of public investment in the human capital of low-income children, high levels of socioeconomic residential segregation, and low levels of progressiveness in the tax-and-transfer system. [50]

Education

Ivy-Plus admissions rates vary with the income of the students' parents, with the acceptance rate of the top 0.1% income percentile being almost twice as much as other students. 20230810 Ivy-Plus admission rates vs parent income percentile.svg
Ivy-Plus admissions rates vary with the income of the students' parents, with the acceptance rate of the top 0.1% income percentile being almost twice as much as other students.

Multiple reports have found that education promotes economic mobility. [52] [53] [54] The report “Pursuing the American Dream: Economic Mobility Across Generations” found that a four-year college degree promotes upward mobility from the bottom and prevents downward mobility from the middle and top. For instance, having a four-year college degree makes someone born into the bottom quintile of income three times more likely to climb all the way to the top as an adult. [52]

Wages and earnings correlate with education. A 2009 survey of young adults [55] who worked full-time [note 1] throughout a full year [note 2] found the median income of whose without a high school diploma ($21,000) was below the poverty level for a family of four ($22,050) [56] and less than half of what whose with a bachelor's degree earned ($45,000). [57]

Education and Income (2017) [57]
Educational AttainmentYoung Adult Median Income
Master's degree or higher$65,000
Bachelor's degree$51,800
High School Diploma (or equivalent)$32,000
No High School Diploma (or equivalent)$26,000

The difference has worsened since 1979 when the average college graduate made 38% more than the average high school graduate. By 2011 college graduates averaged made 75% more income. [58] "Mobility" to the "class" of college graduates has declined. Those born with parents who graduated from college have far better odds of graduating from college than those born to high school graduates. [59]

Some scholars (such as Isabel Sawhill) have complained about the effect of education on mobility

“At virtually every level, education in America tends to perpetuate rather than compensate for existing inequalities. The reasons are threefold. First, the K through 12 education system is simply not very strong and thus is not an effective way to break the link between parental background and a child’s eventual success. ... Second, because K–12 education is financed largely at the state and local level, resources devoted to education are closely linked with where people live and with the property wealth of their neighbors. For this and other reasons, poor children tend to go to poor schools and more advantaged children to good schools. ... Finally, access both to a quality preschool experience and to higher education continues to depend quite directly on family resources.” [60]

Others (Robert M. Hauser) have defended educational attainment as also freeing "individuals from the constraints of their social origins." [61]

Poverty

Social connectedness to people of higher income levels is a strong predictor of upward income mobility. However, data shows substantial social segregation correlating with economic income groups. 20220801 Economic stratification - cross-class friendships - bar chart.svg
Social connectedness to people of higher income levels is a strong predictor of upward income mobility. However, data shows substantial social segregation correlating with economic income groups.

Comparing the US with one high-mobility state (Denmark), journalist Kevin Drum concluded that lack of mobility for the poorest children in the United States seems to be the primary reason for America's lag behind other developed countries. [48] A study from the Economic Mobility Project found that growing up in a high-poverty neighborhood increases Americans’ risk of experiencing downward mobility and explains a sizable portion of the black-white downward mobility gap. The report's analysis also showed that black children who experience a reduction in their neighborhood's poverty rate have greater economic success in adulthood than black children who experience poverty rates that increase or are stable. [63]

Gender and race

Reports analyzing the economic mobility of African-Americans compared to that of whites have found stark differences. One report found that 53 percent of blacks born in the bottom income quintile remain there as adults, while only 33 percent of whites do. [64] Research has also found that the children of black middle-class families are more likely to fall out of the middle class. [53]

Despite the increased presence of blacks and women in the work force over the years, women and non-whites hold jobs with less rank, authority, opportunity for advancement and pay than men and whites, [65] [66] a "glass ceiling" being said to prevent them from occupying more than a very small percentage in top managerial positions.

One explanation for this is seen in the networks of genders and ethnic groups. The more managers there are in an employees' immediate work environment, the higher the employees chances of interacting and spending time with high status/income employees, the more likely these employees are to be drawn on for promotion. [67] [68] As of the 1990s, the vast majority of all clerical and office workers are women, but made up less than half of all managers. Less than 15% of all managers were minorities, while roughly a quarter of all clerical and office employees were. The networks of women and minorities are simply not as strong as those of males and whites, putting them at a disadvantage in status/income mobility.

For women, another explanation for this "glass ceiling" effect in the American work force is the job-family trade off. [69] While both men and women feel that a conflict exists between job and family, women with children, particularly married women, are more likely to either temporarily leave the labor force or cut back on employment by using flex time, working part-time or part of the year. [70] [71] [72] Unfortunately, the outcome is lower mobility, since part-time employment is usually lower paying employment, with less chance of promotion into a higher status job or likelihood of a return to full-time employment for at least a few years.

Taking a leave from the work force tends to decrease human capital when it comes to finding a job. [73] Women are also more likely than men to take leave from their jobs to care for others rather than themselves. [74] [75] [76] Knowing this, employers are wary of hiring and promoting women in the work force.[ citation needed ]

Others have pointed out that men have statistically been willing to accept job conditions that women were not, such as working outside in extreme weather, working where you can become physically dirty on a regular basis, working more hours, etc. This is based on survey information, and shows that it is difficult to make direct comparisons ('apples to apples'). [77] Conservatives also question the extent of gender discrimination arguing that competition between firms would lead them to bid up wages of any group if they provided the same or better value of work for less pay as employees.

Immigration

According to economist George J. Borjas, most immigrants to the US are at "a sizable earning disadvantage" compared to native-born workers, and the earnings of different groups of immigrants vary widely. Borjas found that intergenerational upward economic mobility averaged between a 5% to 10% increase in income from the first to the second generation of immigrants, although there was wide variation among ethnic groups. Other research suggests that length of time resided in the U.S. narrows the occupational gap between Hispanic immigrants and non-Hispanic whites and U.S.-born Hispanic counterparts. [78] Overcoming language barriers and adjusting to the new environment and culture to American society creates barriers for new immigrants, and "there is significant economic 'catching up' between the first and second generations" (second generation being defined as child with at least one parent not born in the United States). This intergenerational mobility includes poor as well as middle income groups, although among the high income Borjas noted a regression towards the mean or equalizing tendency in income/status, whereby children of very successful immigrants tended to have lower, not higher, incomes/status than their parents, becoming successful but not as successful. [79]

In particular, children coming from low-income immigrant families struggle with the disadvantages of their legal status more than the average American due to the level of stress they are exposed to, most specifically through the manner in which they are perceived as well as the way in which they see themselves and their future. Scholars that have studied the social characteristics that arise from having an immigrant status have defined this state of struggle as the "master status" that anchors their decisions in every aspect of their lives, often serving as a crippling agent in their individual developments. When looking specifically into the Latino population, there is an immense hesitance in pursuing education post-high school. According to a study conducted by Abrego in 2006, Latino immigrants without a legal status were more reluctant in pursuing higher education levels, including college as compared to their legal brethren. [80] Most immigrants suffer silently in this manner due to a lack of a healthy immigrant niche construction through which they are able to assimilate accordingly and take advantage of the educational and social opportunities. In Norway for example, the government was able to facilitate increasing levels of re-distributive policies that allowed for a functional welfare state in which the immigrant population were able to lower the gaps of social class differences and becoming increasingly affluent in their ambitions of maintaining better lifestyles. [81] Hence, social mobility is the deferred offspring of many welfare states including the United States due to their low public spending incentives. Studies conducted on education spending in the United States have shown that as compared to the private funding of education, only 2.7% of the nation's total GDP is spent towards public education. [82]

Shifting the perspective to the effects immigration has placed on the existing economic status of the African-American population, there is yet even higher levels of economic bifurcations. While African-Americans occupied larger employment levels of at least 19 percent in sectors like transportation and hospital and social services during the 1990s, immigration caused a shift in this employment trend pushing them more towards private or self employment. One causing factor is the growing Puerto Rican and Mexican population who have increasingly found their employment niches in these specific sectors. [83] Another pattern seen in the economic regression of African-Americans is the invisible role of education in expanding their career opportunities. Historical data shows that the African-American's future advances were highly discounted by scholars like Orley Ashenfelter (1977) and William A. Darity (1982). Consensus studies conducted in the earlier periods of 1940 through 1960 also led many people to argue that black economic mobility through the route of education was closed. [84] Comparatively, the 1990 Census as conducted by the National Center for Health Statistics showed that African-Americans made 63 percent less than the average American due to poor health conditions driven by their unequal social status. [85] Displacement is seen even in low wage sector jobs, including janitorial positions that have become increasingly taken over by Mexicans and while African-Americas have still held these positions in the government, their economic position in considerably diminishing in this area. [86] Hence, the economic stability of African-Americans are not only challenged through their social state but by the growing migration patterns as well.

Impact of incarceration

According to some researchers, America's high incarceration (imprisonment) rate, and "War on Drugs" policies, have created an underclass with severely limited social mobility. Within the United States the prison population has been steadily increasing since the early 1970s and has now surpassed two million, making it the highest per capita rate in the world. This boom has been fueled to a large extent by the War on Drugs starting in the 1980s. In addition to the mobility handicaps of imprisonment, this "war" has effectively created a poor, immobile class by denying one of the most important tools for social mobility—education—in a number of ways

  1. The drug war has combined with public school zero-tolerance policies to remove tens of thousands of adolescents from their public schools.
  2. Denial of higher education funding has been adopted as an additional punishment for drug offenders.
  3. The war on drugs siphons drug users out of society and into prison. [87]

The lack of education for convicted felons is compounded with difficulties in finding employment. These two factors contribute towards a high recidivism rate and downward social mobility.

Tax expenditures

Tax expenditures, partial exemption of the poor from taxation through reliance on progressive income taxes rather than sales taxes for revenue or tax rebates such as the earned income tax credit loosely correlate with income mobility with areas which tax the poor heavily such as the Deep South showing low mobility. [88] [89] The literature that supports this claim acknowledges that nontrivial confounds are inherent to this line of inquiry, however.

Other factors

Significant correlations have been found between intergenerational mobility and economic inequality, economic and racial residential segregation, measures of K-12 school quality (such as test scores and high school dropout rates), social capital indices, and measures of family structure (such as the fraction of single parents in an area) [90]

History of study

Sociologists Blau and Duncan collected mobility data along with the U.S. Bureau of the Census in 1962. The data included information on occupational family backgrounds. In 1962, 56.8% of sons with fathers who had occupations in upper nonmanual ended up with occupations in the same level. Only 1.2% of sons with fathers who had farming occupations ended up in upper nonmanual occupations. In 1973, these differences increased. 59.4% of sons with fathers in upper nonmanual occupations achieved occupations of this same level and 0.9% of sons with fathers in farming occupations ended up in upper nonmanual occupations. However, the occupational structure is more rigid towards the top and bottom. Those in lower nonmanual occupations, and upper and lower manual occupations were more likely to be vertically mobile. Upper nonmanual occupations have the highest level of occupational inheritance. [91] In the 1980s studies found that only 20 percent of the income gap persisted between generations in America, according to the Christian Science Monitor. However, by 2003 improvements in econometrics showed that poverty could endure over several generations. [92]

See also

Notes

  1. ↑ (35 or more hours per week)
  2. ↑ (50 or more weeks of employment)

Related Research Articles

<span class="mw-page-title-main">Social class in the United States</span> Grouping Americans by some measure of social status

Social class in the United States refers to the idea of grouping Americans by some measure of social status, typically by economic status. However, it could also refer to social status and/or location. The idea that American society can be divided into social classes is disputed, and there are many competing class systems.

<span class="mw-page-title-main">Economic inequality</span> Distribution of income or wealth between different groups

Economic inequality is an umbrella term for a) income inequality or distribution of income, b) wealth inequality or distribution of wealth, and c) consumption inequality. Each of these can be measured between two or more nations, within a single nation, or between and within sub-populations.

<span class="mw-page-title-main">American Dream</span> National ethos of the United States

"The American Dream" is a phrase referring to a purported national ethos of the United States: that every person has the freedom and opportunity to succeed and attain a better life. The phrase was popularized by James Truslow Adams during the Great Depression in 1931, and has had different meanings over time. Originally, the emphasis was on democracy, liberty and equality, but more recently has been on achieving material wealth and upward mobility.

<span class="mw-page-title-main">Social mobility</span> Mobility to move social classes

Social mobility is the movement of individuals, families, households or other categories of people within or between social strata in a society. It is a change in social status relative to one's current social location within a given society. This movement occurs between layers or tiers in an open system of social stratification. Open stratification systems are those in which at least some value is given to achieved status characteristics in a society. The movement can be in a downward or upward direction. Markers for social mobility such as education and class, are used to predict, discuss and learn more about an individual or a group's mobility in society.

<span class="mw-page-title-main">Income distribution</span> How a countrys total GDP is distributed amongst its population

In economics, income distribution covers how a country's total GDP is distributed amongst its population. Economic theory and economic policy have long seen income and its distribution as a central concern. Unequal distribution of income causes economic inequality which is a concern in almost all countries around the world.

Though the American middle class does not have a definitive definition, contemporary social scientists have put forward several ostensibly congruent theories on it. Depending on the class model used, the middle class constitutes anywhere from 25% to 75% of households.

<span class="mw-page-title-main">Economic mobility</span> Ability to improve ones economic status

Economic mobility is the ability of an individual, family or some other group to improve their economic status—usually measured in income. Economic mobility is often measured by movement between income quintiles. Economic mobility may be considered a type of social mobility, which is often measured in change in income.

<span class="mw-page-title-main">Affluence in the United States</span> Economical and financial advantage

Affluence refers to an individual's or household's economical and financial advantage in comparison to others. It may be assessed through either income or wealth.

<span class="mw-page-title-main">Income inequality in the United States</span>

Income inequality has fluctuated considerably in the United States since measurements began around 1915, moving in an arc between peaks in the 1920s and 2000s, with a 30-year period of relatively lower inequality between 1950 and 1980.

<span class="mw-page-title-main">Social inequality</span> Uneven distribution of resources in a society

Social inequality occurs when resources within a society are distributed unevenly, often as a result of inequitable allocation practices that create distinct unequal patterns based on socially defined categories of people. Differences in accessing social goods within society are influenced by factors like power, religion, kinship, prestige, race, ethnicity, gender, age, sexual orientation, intelligence and class. Social inequality usually implies the lack of equality of outcome, but may alternatively be conceptualized as a lack of equality in access to opportunity.

<span class="mw-page-title-main">Wealth inequality in the United States</span>

The inequality of wealth has substantially increased in the United States in recent decades. Wealth commonly includes the values of any homes, automobiles, personal valuables, businesses, savings, and investments, as well as any associated debts.

<span class="mw-page-title-main">Poverty in the United States</span>

In the United States, poverty has both social and political implications. In 2020, there were 37.9 million people in poverty. Some of the many causes include income, inequality, inflation, unemployment, debt traps and poor education. The majority of adults living in poverty are employed and have at least a high school education. Although the US is a relatively wealthy country by international standards, it has a persistently high poverty rate compared to other developed countries due in part to a less generous welfare system.

Educational Inequality is the unequal distribution of academic resources, including but not limited to school funding, qualified and experienced teachers, books, physical facilities and technologies, to socially excluded communities. These communities tend to be historically disadvantaged and oppressed. Individuals belonging to these marginalized groups are often denied access to schools with adequate resources and those that can be accessed are so distant from these communities. Inequality leads to major differences in the educational success or efficiency of these individuals and ultimately suppresses social and economic mobility. Inequality in education is broken down into different types: regional inequality, inequality by sex, inequality by social stratification, inequality by parental income, inequality by parent occupation, and many more.

<span class="mw-page-title-main">Raj Chetty</span> American economist

Nadarajan "Raj" Chetty is an Indian-American economist who is the William A. Ackman Professor of Public Economics at Harvard University. Some of Chetty's recent papers have studied equality of opportunity in the United States and the long-term impact of teachers on students' performance. Offered tenure at the age of 28, Chetty became one of the youngest tenured faculty in the history of Harvard's economics department. He is a recipient of the John Bates Clark Medal and a 2012 MacArthur Fellow. Currently, he is also an advisory editor of the Journal of Public Economics. In 2020, he was awarded the Infosys Prize in Economics, the highest monetary award recognizing achievements in science and research, in India.

Tax policy and economic inequality in the United States discusses how tax policy affects the distribution of income and wealth in the United States. Income inequality can be measured before- and after-tax; this article focuses on the after-tax aspects. Income tax rates applied to various income levels and tax expenditures primarily drive how market results are redistributed to impact the after-tax inequality. After-tax inequality has risen in the United States markedly since 1980, following a more egalitarian period following World War II.

Socio-economic mobility in Canada refers to the movement of Canadians from one social class or economic level to another, The data shows an increase in intergenerational social mobility, however it is argued that such trends have remained stable since the 1990s.

<span class="mw-page-title-main">Great Gatsby Curve</span> Relates income inequality and income mobility

The "Great Gatsby Curve" is the term given to the positive empirical relationship between cross-sectional income inequality and persistence of income across generations. The scatter plot shows a correlation between income inequality in a country and intergenerational income mobility.

Myth of meritocracy is a phrase arguing that meritocracy, or achieving upward social mobility through one's own merits regardless of one's social position, is not widely attainable in capitalist societies because of inherent contradictions. Meritocracy is argued to be a myth because, despite being promoted as an open and accessible method of achieving upward class mobility under neoliberal or free market capitalism, wealth disparity and limited class mobility remain widespread, regardless of individual work ethic. Some scholars argue that the wealth disparity has even increased because the "myth" of meritocracy has been so effectively promoted and defended by the political and private elite through the media, education, corporate culture, and elsewhere. Economist Robert Reich argues that many Americans still believe in meritocracy despite "the nation drifting ever-farther away from it."

Patrick McGraw Kline is an American economist and Professor of Economics of the University of California at Berkeley. In 2018, his research was awarded the Sherwin Rosen Prize by the Society of Labor Economists for "outstanding contributions in the field of labor economics". In 2020, he was awarded the prestigious IZA Young Labor Economist Award.

The Global Social Mobility Index is an index prepared by the World Economic Forum. The inaugural index from 2020 ranked 82 countries and has not been updated since. The Index measures social mobility holistically through 5 determinants. The findings from the index were then used in the World Economic Forum's Global Social Mobility Report 2020, which provided recommendations for governments and businesses. Researchers have used the index to analyze income inequality and have determined reasons for countries to improve social mobility.

References

Notes

  1. ↑ "Two Leading Economists Disagree About the Flagging American Dream". The Economist . May 14, 2020. Retrieved May 19, 2020.
  2. ↑ Random House Unabridged Dictionary second edition.
  3. ↑ "Glossary" (PDF). Polity . Archived from the original on October 29, 2005. Retrieved March 12, 2024.
  4. 1 2 3 4 5 6 7 Harder for Americans to Rise From Lower Rungs | By JASON DePARLE | January 4, 2012]
  5. ↑ Corak, Miles (May 2016). "Inequality from Generation to Generation: The United States in Comparison" (PDF). IZA Institute of Labor Economics .
  6. ↑ "The Global Social Mobility Report 2020" (PDF). World Economic Forum . January 2020.
  7. ↑ Chetty, Raj; Hendren, Nathaniel; Kline, Patrick; Saez, Emmanuel; Turner, Nicholas (May 1, 2014). "Is the United States Still a Land of Opportunity? Recent Trends in Intergenerational Mobility". American Economic Review. 104 (5): 141–147. doi:10.1257/aer.104.5.141. ISSN   0002-8282. S2CID   14776623.
  8. 1 2 Ever higher society, ever harder to ascend Whatever happened to the belief that any American could get to the top? economist.com December 29, 2004
  9. ↑ Hungerford, Thomas L. (December 29, 2011). Changes in the distribution of income among tax filers between 1996 and 2006: The role of labor income, capital income, and tax policy (PDF). Congressional Research Service.
  10. ↑ Hungerford, Thomas L. (March 2011). "How income mobility affects income inequality: US evidence in the 1980s and the 1990s". Journal of Income Distribution. 16 (2). Ad Libros Publications Inc. in association with York University, Canada: 83–103. Pdf.
  11. ↑ Bradbury, Katherine (October 20, 2011). Trends in U.S. family income mobility, 1969–2006 (working paper no. 11-10. Boston, Mass: Federal Reserve Bank of Boston. Pdf.
  12. ↑ Aaronson, Daniel; Mazumder, Bhashkar (Winter 2008). "Intergenerational economic mobility in the United States, 1940 to 2000". The Journal of Human Resources. 43 (1). The Board of Regents of the University of Wisconsin–Milwaukee: 139–72. doi:10.1353/jhr.2008.0008. S2CID   55711878. Pdf.
  13. ↑ Urahn, Susan K., et al. (July 2012) Pursuing the American Dream: Economic Mobility Across Generations Pew Charitable Trusts
  14. ↑ Vasia Panousi; Ivan Vidangos; Shanti Ramnath; Jason DeBacker; Bradley Heim (Spring 2013). "Inequality Rising and Permanent Over Past Two Decades". Brookings Papers on Economic Activity. Brookings Institution. Archived from the original on April 8, 2013. Retrieved March 23, 2013.
  15. ↑ LEONHARDT, DAVID (January 23, 2014). "Upward Mobility Has Not Declined, Study Says". New York Times. Retrieved January 23, 2014.
  16. ↑ Chetty, Raj; Nathaniel Henderson; Patrick Kline; Emmanuel Saez; Nicholas Turner. "NBER WORKING PAPER SERIES, WHERE IS THE LAND OF OPPORTUNITY? THE GEOGRAPHY OF INTERGENERATIONAL MOBILITY IN THE UNITED STATES". January 2014. Equality of Opportunity Project. Retrieved January 23, 2014.
  17. ↑ Economic Mobility: Is the American Dream Alive and Well? Archived May 3, 2012, at the Wayback Machine Economic Mobility Project| May 2007
  18. ↑ English grammar 4U online| "In general, the American Dream can be defined as being the opportunity and freedom for all citizens to achieve their goals and become rich and famous if only they work hard enough."
  19. ↑ the theme song of the 1975–85 TV sitcom The Jeffersons
  20. ↑ Economic Mobility: Is the American Dream Alive and Well? Archived May 3, 2012, at the Wayback Machine Economic Mobility Project| May 2007
  21. 1 2 3 4 CAP: Understanding Mobility in America – April 26, 2006
  22. ↑ Wilkinson, Richard (Oct 2011). How economic inequality harms societies (transcript). TED. (Quote featured on his personal profile on the TED website). Retrieved 12 December 2014.
  23. ↑ Corak, Miles (August 1, 2013). "Income Inequality, Equality of Opportunity, and Intergenerational Mobility". Journal of Economic Perspectives. 27 (3): 79–102. doi: 10.1257/jep.27.3.79 . hdl: 10419/80702 . ISSN   0895-3309. S2CID   11052119.
  24. 1 2 Urhan, Susan. "Pursuing the American Dream: Economic Mobility Across Generations" (PDF). Pew Charitable Trusts.
  25. ↑ Howell-Moroney, Michael (2008). "The Tiebout Hypothesis 50 Years Later". Public Administration Review. 68: 101. doi:10.1111/j.1540-6210.2007.00840.x.
  26. ↑ Johnson, Wendy; Brett, Caroline E.; Deary, Ian J. (January 1, 2010). "The pivotal role of education in the association between ability and social class attainment: A look across three generations". Intelligence. 38 (1): 55–65. doi:10.1016/j.intell.2009.11.008.
  27. ↑ Marioni, Riccardo E.; Davies, Gail; Hayward, Caroline; Liewald, Dave; Kerr, Shona M.; Campbell, Archie; Luciano, Michelle; Smith, Blair H.; Padmanabhan, Sandosh (May 1, 2014). "Molecular genetic contributions to socioeconomic status and intelligence". Intelligence. 44 (100): 26–32. doi:10.1016/j.intell.2014.02.006. PMC   4051988 . PMID   24944428.
  28. ↑ Tucker-Drob, Elliot M.; Bates, Timothy C. (December 15, 2015). "Large Cross-National Differences in Gene × Socioeconomic Status Interaction on Intelligence". Psychological Science. 27 (2): 138–149. doi:10.1177/0956797615612727. ISSN   0956-7976. PMC   4749462 . PMID   26671911.
  29. ↑ Tom Ashbrook (host), David Leonhardt (guest), Raj Chetty (guest), Isabel Sawhill (guest) (July 23, 2013). "Upward Mobility In America". On Point (Radio broadcast). WBUR 90 FM.
  30. ↑ Economic Mobility Project
  31. ↑ Corak, Miles. 2006. "Do Poor Children Become Poor Adults? Lessons from a Cross Country Comparison of Generational Earnings Mobility." Research on Economic Inequality, 13 no. 1:143–88.
  32. ↑ 'Scandinavian Dream' is true fix for America's income inequality. CNN Money , June 3, 2015. Retrieved June 6, 2015.
  33. ↑ American Exceptionalism in a New Light: A Comparison of Intergenerational Earnings Mobility in the Nordic Countries, the United Kingdom and the United States Markus Jäntti et al.| January 2006
  34. ↑ Economic mobilities of Families Across Generations Brookings Institution
  35. ↑ Income Inequality From Generation To Generation Robert Lenzner| forbes.com| March 26, 2012
  36. 1 2 Krugman, Paul (January 15, 2012) "The Great Gatsby Curve" The New York Times
  37. ↑ Berman, Yonatan (August 11, 2016) "The Great Gatsby Curve Revisited - Understanding the Relationship Between Inequality and Intergenerational Mobility" SSRN.com
  38. ↑ Economic Report of the President. Transmitted to Congress Archived September 6, 2012, at the Wayback Machine
  39. ↑ Pilkington, Ed (December 15, 2017). "Trump turning US into 'world champion of extreme inequality', UN envoy warns". The Guardian . Retrieved December 16, 2017.
  40. 1 2 3 Economic Mobility of Families Across Generations. Julia B. Isaacs. November 13, 2007. Economic Mobility Project, Washington, D.C.
  41. 1 2 3 Krugman, Paul (December 19, 2001) "The Rich, the Right, and the Facts: Deconstructing the Income Distribution Debate" Prospect.org
  42. ↑ Thomas A. Garrett. U.S. Income Inequality: It’s Not So Bad. Inside the Vault. Spring 2010. Federal Reserve Bank of St. Louis.
  43. ↑ Income Mobility in the U.S. from 1996 to 2005. Report of the DEPARTMENT OF THE TREASURY. November 13, 2007. p. 4.
  44. ↑ Uncovering the American Dream: Inequality and Mobility in Social Security Earnings Data since 1937 Wojciech Kopczuk, Emmanuel Saez, Jae Song, September 15, 2007, Figure 4B
  45. 1 2 Congressional Budget Office: Trends in the Distribution of Household Income Between 1979 and 2007. October 2011.
  46. ↑ Krugman, Paul (November 3, 2011)"Millionaire For A Day" The New York Times
  47. ↑ Noah, Timothy (January 13, 2012) "White House: Here's Why You Have To Care About Inequality" The New Republic
  48. 1 2 Kevin Drum (January 5, 2011). "Social Mobility in America: It's All About the Poor" motherjones.com
  49. ↑ Hendren, Nathaniel; Raj Chetty; Patrick Kline; Emmanuel Saez (July 2013). "Summary of Project Findings, July 2013" (Revised draft). equality-of-opportunity.org. There are some areas in the U.S. where a child's chances of success do not depend heavily on his or her parents' income.{{cite journal}}: Cite journal requires |journal= (help)
  50. ↑ Mitnik, Pablo A.; Bryant, Victoria L.; Grusky, David B. (2024). "A Very Uneven Playing Field: Economic Mobility in the United States". American Journal of Sociology. 129 (4): 1216–1276. doi:10.1086/728737. ISSN   0002-9602. Archived from the original on March 19, 2024.
  51. ↑ Chetty, Raj; Deming, David J.; Friedman, John N. (July 2023). "Diversifying Society's Leaders? The Determinants and Consequences of Admission to Highly Selective Colleges" (PDF). Opportunity Insights. p. 2. Archived (PDF) from the original on July 31, 2023. Figure 3. "Ivy-Plus" refers to Ivy League schools plus others with similar prestige, rankings or selectivity.
  52. 1 2 "Pursuing the American Dream: Economic Mobility in the United States". Pew Charitable Trusts Economic Mobility Project. Retrieved August 1, 2012.
  53. 1 2 "Downward Mobility from the Middle Class: Waking Up from the American Dream". Pew Charitable Trusts Economic Mobility Project.
  54. ↑ "Promoting Economic Mobility by Increasing Postsecondary Education". Pew Charitable Trusts Economic Mobility Project.
  55. ↑ ages 25–34
  56. ↑ 2009 HHS POVERTY GUIDELINES US Department of Health and Human Services.
  57. 1 2 "Fast Facts, Income of young adults". National Center for Educational Statistics. Institute of Education Sciences. Retrieved January 22, 2020.
  58. ↑ Federal Reserve chairman, Ben Bernanke cited by journalist David Brooks in The Wrong Inequality By DAVID BROOKS| nyt.com |October 31, 2011.
  59. ↑ The Wrong Inequality By David Brooks| nyt.com |October 31, 2011.
  60. ↑ 2006 Policy Brief of the Brookings Institution, Isabel Sawhill (2006:3)
  61. ↑ Intergenerational Economic Mobility in the United States, Measures, Differentials and Trends Robert M. Hauser| April 6, 2010
  62. 1 2 Data from Chetty, Raj; Jackson, Matthew O.; Kuchler, Theresa; Stroebel, Johannes; et al. (August 1, 2022). "Social capital I: measurement and associations with economic mobility". Nature. 608 (7921): 108–121. Bibcode:2022Natur.608..108C. doi:10.1038/s41586-022-04996-4. PMC   9352590 . PMID   35915342. Charted in Leonhardt, David (August 1, 2022). "'Friending Bias' / A large new study offers clues about how lower-income children can rise up the economic ladder". The New York Times. Archived from the original on August 1, 2022.
  63. ↑ "Neighborhoods and the Black-White Mobility Gap". Pew Charitable Trusts Economic Mobility Project.
  64. ↑ "Pursuing the American Dream: Economic Mobility Across Generations" (PDF). Pew Charitable Trusts Economic Mobility Project.
  65. ↑ African American women are farther behind white women in jobs, says Center of American progress. Fact Finding Report of the Federal Glass Ceiling Commission, 1995
  66. ↑ Women and men at work Reskin, B., & Padavic, I. (1994), Thousand Oaks, CA: Pine Forge Press
  67. ↑ Men's and Women's Networks: A Study of Interaction Patterns and Influence in an Organization Academy of management Journal 28:2 Daniel J. Brass, 1985"
  68. ↑ Ibarra, Herminia (1992). "Homophily and Differential Returns: Sex Differences in Network Structure and Access in an Advertising Firm". Administrative Science Quarterly. 37 (3): 422–47. doi:10.2307/2393451. JSTOR   2393451.
  69. ↑ Data from the 1996 General Social Survey examined the trade-offs that women and men made as they attempted to balance their employment and family obligations, and the multiple ways that gender affects those trade-offs (Davis & Smith 1996)
  70. ↑ Carlisle, W. (1994). Sharing home responsibilities: Women in dual-career marriages. In C. W. Konek & S. L. Kitch (Eds.), Women and careers: Issues and challenges (pp. 141–52). Newbury Park, CA: Sage.
  71. ↑ Estes, S. B.; Glass, J. L. (1996). "Job changes following childbirth: Are women trading compensation for family-responsive work conditions?". Work and Occupations. 23 (4): 405–36. doi:10.1177/0730888496023004005. S2CID   145421939.
  72. ↑ Shelton, B. A. (1992).Women, men and time: Gender differences in paid work, housework, and leisure. New York: Greenwood.
  73. ↑ Jacobs, Sheila (1999). "Trends in Women's Career Patterns and in Gender Occupational Mobility in Britain". Gender, Work & Organization. 6: 32–46. doi:10.1111/1468-0432.00067.
  74. ↑ Gerstel, N. K. McGonagle (1999). "Job leaves and the limits of the family and medical leave act: the effects of gender, race and family". Work and Occupations. 26: 510–34. doi:10.1177/0730888499026004006. hdl: 2027.42/69106 . S2CID   145464821.
  75. ↑ Sandberg, J.C. (1999). The effects of family obligations and workplace resources on men's and women's use of family leaves. In T.L. Parcel (Ed.), Research in the sociology of work, Volume 7, (pp. 261–81). Stamford, CT: JAI Press.
  76. ↑ Sandberg, Joanne C., and Daniel B. Cornfield . 2000. Returning to work: The impact of gender, family, and work on terminating a family or medical leave. In T. L. Parcel&D.B. Cornfield (Eds.), Work & family: Research informing policy (pp. 161–84). Thousand Oaks, CA: Sage.
  77. ↑ Gender and Rural Development Alexander von Humboldt| p. 127
  78. ↑ Federal Reserve Bank of Chicago, The Occupational Assimilation of Hispanics in the U.S., 2004
  79. ↑ George J. Borjas, Making It In America: Social Mobility in the Immigrant Population Fall 2006
  80. ↑ Hsin, Amy; Reed, Holly E. (February 27, 2019). "The Academic Performance of Undocumented Students in Higher Education in the United States". International Migration Review. 54: 289–315. doi:10.1177/0197918318825478. S2CID   150715008.
  81. ↑ Friberg, Jon Horgen; Midtbøen, Arnfinn H. (2019). "The Making of Immigrant Niches in an Affluent Welfare State". International Migration Review. 53 (2): 322–345. doi: 10.1177/0197918318765168 . hdl: 11250/2500263 . ISSN   0197-9183.
  82. ↑ Iversen, Torben; Stephens, John D. (April 1, 2008). "Partisan Politics, the Welfare State, and Three Worlds of Human Capital Formation". Comparative Political Studies. 41 (4–5): 600–637. doi:10.1177/0010414007313117. S2CID   55656832.
  83. ↑ Bean, Frank D.; Bell-Rose, Stephanie (December 9, 1999). Immigration and Opportuntity: Race, Ethnicity, and Employment in the United States. Russell Sage Foundation. ISBN   9781610440332.
  84. ↑ Smith, James P.; Welch, Finis R. (1989). "Black Economic Progress After Myrdal". Journal of Economic Literature. 27 (2): 519–564. ISSN   0022-0515. JSTOR   2726688.
  85. ↑ Williams, David R.; Jackson, James S.; Anderson, Norman B. (1997). "Racial Differences in Physical and Mental Health: Socio-economic Status, Stress and Discrimination" (PDF). Journal of Health Psychology. 2 (3): 335–351. doi:10.1177/135910539700200305. hdl: 2027.42/67159 . ISSN   1359-1053. PMID   22013026. S2CID   975264.
  86. ↑ Bean, Frank D.; Bell-Rose, Stephanie (1999). Immigration and Opportuntity: Race, Ethnicity, and Employment in the United States. Russell Sage Foundation. ISBN   9781610440332.
  87. ↑ Blumenson, Eric; Eva S. Nilsen (May 16, 2002). How to construct an underclass, or how the War on Drugs became a war on education (PDF). Drug Policy Forum of Massachusetts.
  88. ↑ Hendren, Nathaniel; Raj Chetty; Patrick Kline; Emmanuel Saez (July 2013). "The Economic Impacts of Tax Expenditures Evidence from Spatial Variation Across the U.S" (Revised draft). equality-of-opportunity.org. We focus on intergenerational mobility because many tax expenditures are loosely motivated by the goal of expanding opportunities for upward income mobility for low-income families. For example, deductions for education and health costs, progressive federal tax deductions for state income taxes, and tax credits aimed at low-income families such as the Earned Income Tax Credit (EITC) all are targeted toward providing increased resources to low income families with children.{{cite journal}}: Cite journal requires |journal= (help)
  89. ↑ David Leonhardt (July 22, 2013). "In Climbing Income Ladder, Location Matters: A study finds the odds of rising to another income level are notably low in certain cities, like Atlanta and Charlotte, and much higher in New York and Boston". The New York Times. Retrieved July 22, 2013.
  90. ↑ Hendren, Nathaniel; Raj Chetty; Patrick Kline; Emmanuel Saez (July 2013). "Summary of Project Findings, July 2013" (Revised draft). equality-of-opportunity.org. we found significant correlations between intergenerational mobility and income inequality, economic and racial residential segregation, measures of K-12 school quality (such as test scores and high school dropout rates), social capital indices, and measures of family structure (such as the fraction of single parents in an area){{cite journal}}: Cite journal requires |journal= (help)
  91. ↑ Kerbo, Harold. "Social Stratification and Inequality" (1996) pp. 331–32 ISBN   0-07-034258-X
  92. ↑ Francis, David R."'Upward Mobility' In Real Decline, Studies Charge." The Christian Science Monitor. January 27, 2003.

Bibliography

Further reading

This page is based on this Wikipedia article
Text is available under the CC BY-SA 4.0 license; additional terms may apply.
Images, videos and audio are available under their respective licenses.