Social Mobility
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Gary Solon -
Raj Chetty -
Florencia Torche
Leaders: Raj Chetty, Gary Solon, Florencia Torche
The purpose of the Social Mobility RG is to develop and exploit new administrative sources for measuring mobility and the effects of policy on mobility out of poverty. This research group is doing so by (a) providing comprehensive analyses of intergenerational mobility based on linked administrative data from U.S. tax returns, W-2s, and other sources, and (b) developing a new infrastructure for monitoring social mobility, dubbed the American Opportunity Study, that is based on linking census and other administrative data. Here’s a sampling of projects:
Small place estimates: The Equal Opportunity Project, led by Raj Chetty, uses tax return data to monitor opportunities for mobility out of poverty. In one of the new lines of analysis coming out of this project, the first round of results at the level of “commuting zones” are being redone at a more detailed level (e.g., census block level), thus allowing for even better inferences about the effects of place.
The American Opportunity Study: This research group is also collaborating with the Census Bureau to develop a new infrastructure for monitoring mobility that treats linked decennial census data as the spine on which other administrative data are hung.
Colleges and rising income inequality: Where do poor children go to attend college? The “Mobility Report Card” will convey the joint distribution of parent and student incomes for every Title IV institution in the United States.
The “absolute mobility” of the poor: What fraction of poor children grow up to earn more than their parents? Have rates of absolute upward mobility changed over time? This project develops a new method of estimating rates of absolute mobility for the 1940-1984 birth cohorts.
Intergenerational elasticities in the U.S.: There remains some debate about the size of intergenerational elasticities in the U.S. A rarely-used sample of 1987 tax data provides new evidence on U.S. elasticities.
Featured Examples
Mobility - CPI Research
| Title | Author | Media | |
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| State of the Union 2019: Social Mobility | Michael Hout |
State of the Union 2019: Social MobilityAuthor: Michael HoutPublisher: Stanford Center on Poverty and Inequality Date: 06/2019
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| The Intergenerational Transmission of Family-Income Advantages in the United States | Mitnik, Pablo A., Bryant, Victoria, Weber, Michael |
The Intergenerational Transmission of Family-Income Advantages in the United StatesAuthor: Mitnik, Pablo A., Bryant, Victoria, Weber, MichaelPublisher: Sociological Science Date: 05/2019 Estimates of economic persistence and mobility in the United States, as measured by the intergenerational elasticity (IGE), cover a very wide range. Nevertheless, careful analyses of the evidence suggested until recently that as much as half, and possibly more, of economic advantages are passed on from parents to children. This “dominant hypothesis” was seriously challenged by the first-ever study of family-income mobility based on tax data (Chetty et al. 2014), which provided estimates of family-income IGEs indicating that only one-third of economic advantages are transmitted across generations and claimed that previous highly influential IGE estimates were upward biased. Using a different tax-based data set, this article provides estimates of family-income IGEs that strongly support the dominant hypothesis. The article also carries out a one-to-one comparison between IGEs estimated with the two tax-based data sets and shows that Chetty et al.’s estimates were driven downward by a combination of attenuation, life-cycle, selection, and functional-form biases. Lastly, the article determines the exact relationship between parental income inequality, economic persistence, and inequality of opportunity for income. This leads to the conclusion that, in the United States, at least half of income inequality among parents is transformed into inequality of opportunity among their children. |
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| Do Tax Cuts Produce More Einsteins? The Impacts of Financial Incentives vs. Exposure to Innovation on the Supply of Inventors | Bell, Alexander M., Chetty, Raj, Jaravel, Xavier, Petkova, Neviana, Van Reenen, John |
Do Tax Cuts Produce More Einsteins? The Impacts of Financial Incentives vs. Exposure to Innovation on the Supply of InventorsAuthor: Bell, Alexander M., Chetty, Raj, Jaravel, Xavier, Petkova, Neviana, Van Reenen, JohnPublisher: National Bureau of Economic Research Date: 01/2019 Many countries provide financial incentives to spur innovation, ranging from tax incentives to research and development grants. In this paper, we study how such financial incentives affect individuals' decisions to pursue careers in innovation. We first present empirical evidence on inventors' career trajectories and income distributions using de-identified data on 1.2 million inventors from patent records linked to tax records in the U.S. We find that the private returns to innovation are extremely skewed – with the top 1% of inventors collecting more than 22% of total inventors' income – and are highly correlated with their social impact, as measured by citations. Inventors tend to have their most impactful innovations around age 40 and their incomes rise rapidly just before they have high-impact patents. We then build a stylized model of inventor career choice that matches these facts as well as recent evidence that childhood exposure to innovation plays a critical role in determining whether individuals become inventors. The model predicts that financial incentives, such as top income tax reductions, have limited potential to increase aggregate innovation because they only affect individuals who are exposed to innovation and have no impact on the decisions of star inventors, who matter most for aggregate innovation. Importantly, these results hold regardless of whether the private returns to innovation are known at the time of career choice. In contrast, increasing exposure to innovation (e.g., through mentorship programs) could have substantial impacts on innovation by drawing individuals who produce high-impact inventions into the innovation pipeline. Although we do not present direct evidence supporting these model-based predictions, our results call for a more careful assessment of the impacts of financial incentives and a greater focus on alternative policies to increase the supply of inventors. |
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| Prenatal Exposure to an Acute Stressor and Children’s Cognitive Outcomes | Florencia Torche |
Prenatal Exposure to an Acute Stressor and Children’s Cognitive OutcomesAuthor: Florencia TorchePublisher: Demography Date: 08/2018 Exposure to environmental stressors is highly prevalent and unequally distributed along socioeconomic lines and may have enduring negative consequences, even when experienced before birth. Yet, estimating the consequences of prenatal stress on children’s outcomes is complicated by the issue of confounding (i.e., unobserved factors correlated with stress exposure and with children’s outcomes). I combine a natural experiment—a strong earthquake in Chile—with a panel survey to capture the effect of prenatal exposure on acute stress and children’s cognitive ability. I find that stress exposure in early pregnancy has no effect on children’s cognition among middle-class families, but it has a strong negative influence among disadvantaged families. I then examine possible pathways accounting for the socioeconomic stratification in the effect of stress, including differential exposure across socioeconomic status, differential sensitivity, and parental responses. Findings suggest that the interaction between prenatal exposures and socioeconomic advantage provides a powerful mechanism for the intergenerational transmission of disadvantage. |
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| Who Becomes an Inventor in America? The Importance of Exposure to Innovation | Alexander M. Bell, Raj Chetty, Xavier Jaravel, Neviana Petkova, John Van Reenen |
Who Becomes an Inventor in America? The Importance of Exposure to InnovationAuthor: Alexander M. Bell, Raj Chetty, Xavier Jaravel, Neviana Petkova, John Van ReenenPublisher: NBER Date: 11/2017 We characterize the factors that determine who becomes an inventor in America by using de-identified data on 1.2 million inventors from patent records linked to tax records. We establish three sets of results. First, children from high-income (top 1%) families are ten times as likely to become inventors as those from below-median income families. There are similarly large gaps by race and gender. Differences in innate ability, as measured by test scores in early childhood, explain relatively little of these gaps. Second, exposure to innovation during childhood has significant causal effects on children's propensities to become inventors. Growing up in a neighborhood or family with a high innovation rate in a specific technology class leads to a higher probability of patenting in exactly the same technology class. These exposure effects are gender-specific: girls are more likely to become inventors in a particular technology class if they grow up in an area with more female inventors in that technology class. Third, the financial returns to inventions are extremely skewed and highly correlated with their scientific impact, as measured by citations. Consistent with the importance of exposure effects and contrary to standard models of career selection, women and disadvantaged youth are as under-represented among high-impact inventors as they are among inventors as a whole. We develop a simple model of inventors' careers that matches these empirical results. The model implies that increasing exposure to innovation in childhood may have larger impacts on innovation than increasing the financial incentives to innovate, for instance by cutting tax rates. In particular, there are many “lost Einsteins” — individuals who would have had highly impactful inventions had they been exposed to innovation. |
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mobility - CPI Affiliates
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Emmanuel Saez |
Income and Wealth Research Group Leader; Professor of Economics; Director, Center for Equitable Growth |
University of California, Berkeley |
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Florencia Torche |
Mobility Research Group Leader, Professor of Sociology |
Stanford University |
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Raj Chetty |
Mobility Research Group Leader, Income and Wealth Research Group Leader, Director of Opportunity Lab |
Harvard University |
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Lawrence Wu |
Professor of Sociology, Director, NYU Population Center |
New York University |
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Miles Corak |
Professor of Economics; Senior scholar of James M. and Cathleen D. Stone Center on Socio-Economic Inequality |
City University of New York |
Pages
Mobility - Other Research
| Title | Author | Media | |
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| How Cultural Capital Emerged in Gilded Age America: Musical Purification and Cross-Class Inclusion at the New York Philharmonic | Fabien Accominotti, Shamus R. Khan, Adam Storer |
How Cultural Capital Emerged in Gilded Age America: Musical Purification and Cross-Class Inclusion at the New York PhilharmonicAuthor: Fabien Accominotti, Shamus R. Khan, Adam StorerPublisher: American Journal of Sociology Date: 05/2018 This article uses a new database of subscribers to the New York Philharmonic to explore how high culture became a form of socially valuable capital in late-19th-century America. The authors find support for the classic account of high culture’s purification and exclusiveness, showing how over the long Gilded Age the social elite of New York attended the Philharmonic both increasingly and in more socially patterned ways. Yet they also find that the orchestra opened up to a new group of subscribers hailing from an emerging professional, managerial, and intellectual middle class. Importantly, the inclusion of this new audience was segregated: they did not mingle with elites in the concert hall. This segregated inclusion paved a specific way for the constitution of cultural capital. It meant that greater purity and greater inclusiveness happened together, enabling elite cultural participation to remain distinctive while elite tastes acquired broader social currency. |
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| Social Mobility and Stability of Democracy: Reevaluating De Tocqueville | Daron Acemoglu, Georgy Egorov, Konstantin Sonin |
Social Mobility and Stability of Democracy: Reevaluating De TocquevilleAuthor: Daron Acemoglu, Georgy Egorov, Konstantin SoninPublisher: Quarterly Journal of Economics Date: 05/2018 An influential thesis often associated with de Tocqueville views social mobility as a bulwark of democracy: when members of a social group expect to join the ranks of other social groups in the near future, they should have less reason to exclude these other groups from the political process. In this article, we investigate this hypothesis using a dynamic model of political economy. As well as formalizing this argument, our model demonstrates its limits, elucidating a robust theoretical force making democracy less stable in societies with high social mobility: when the median voter expects to move up (respectively down), she would prefer to give less voice to poorer (respectively richer) social groups. Our theoretical analysis shows that in the presence of social mobility, the political preferences of an individual depend on the potentially conflicting preferences of her “future selves,” and that the evolution of institutions is determined through the implicit interaction between occupants of the same social niche at different points in time. |
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| And Their Children After Them? The Effect of College on Educational Reproduction | Matthew Lawrence, Richard Breen |
And Their Children After Them? The Effect of College on Educational ReproductionAuthor: Matthew Lawrence, Richard BreenPublisher: American Journal of Sociology Date: 09/2016 Conventional analyses of social mobility and status reproduction retrospectively compare an outcome of individuals to a characteristic of their parents. By ignoring the mechanisms of family formation and excluding childless individuals, conventional approaches introduce selection bias into estimates of how characteristics in one generation affect an outcome in the next. The prospective approach introduced here integrates the effects of college on marriage and fertility into the reproduction of educational outcomes. Marginal structural models with inverse probability of treatment weighting are used with data from the Wisconsin Longitudinal Study to estimate the causal effect of pathways linking graduating from college with having a child who graduates from college. Results show that college increases male graduates’ probability of having a child who completes college; for female graduates there is no effect. The gender distinction is largely explained by the negative effects of college on women’s likelihood to marry and have children. |
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| Earnings Inequality and Mobility in the United States: Evidence from Social Security Data since 1937 | Wojciech, Kopczuk, Emmanuel Saez and Jae Song |
Earnings Inequality and Mobility in the United States: Evidence from Social Security Data since 1937Author: Wojciech, Kopczuk, Emmanuel Saez and Jae SongPublisher: Date: 12/2010 |
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| The Race Between Education and Technology | Goldin, Claudia, Lawrence F. Katz |
The Race Between Education and TechnologyAuthor: Goldin, Claudia, Lawrence F. KatzPublisher: Harvard University Press Date: 03/2010 |
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