Thursday, January 23, 2014

US Income Mobility Unchanged Over Last 3 Decades

From The Wall Street Journal, "New Data Muddle Debate on Economic Mobility: Study Finds the Odds of a Child Moving Up Economic Ladder Haven't Changed in Recent Decades" by Damian Paletta:
The odds of a child moving up the economic ladder have remained about the same for the past three decades, according to a comprehensive new study that contradicts the narrative in Washington that economic mobility has declined in recent years.
The authors of the study being published Thursday by the National Bureau of Economic Research concluded that a widening income gap hasn't translated into less economic mobility than in the past. At the same time, they said economic mobility in the U.S. remains relatively low when compared with other developed nations, and is particularly poor in some parts of the country.

Raj Chetty, a Harvard University economist who co-authored the study, said the stable but low levels of mobility create higher stakes for what is known as the "birth lottery," the impact of the household that children are born into.
The study examined anonymous data from about 50 million people born since 1971 and is more comprehensive than past work on the subject, some of which has shown mobility to be relatively flat and others that projected mobility had worsened.

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