Raj Chetty's Research on Social Mobility
Introduction to Social Mobility
What is Social Mobility?
Social mobility is the ability of individuals or families to move up or down the economic ladder within a society. Think of it as the chance to improve your financial standing compared to the one you were born into. It’s a core part of the “American Dream” — the idea that anyone can achieve success through hard work, regardless of their background.
Economists look at mobility in two main ways: absolute and relative.
Absolute mobility asks: Are you better off financially than your parents were at the same age? This often reflects broad economic growth. If the whole economy grows, most people can be better off than the previous generation.
Relative mobility asks: How does your position on the economic ladder compare to your parents' position? It measures your ability to move from one income group to another. For example, what are the chances that someone born into a low-income family will reach a high-income bracket as an adult?
While both are important, relative mobility is often seen as a key indicator of equal opportunity. A society with high relative mobility is one where your starting point in life doesn’t predetermine your destination.
Measuring the Movement
Measuring social mobility is complex, but the most common method is to compare the incomes of parents to the incomes of their children when they become adults. Researchers often divide the population into five equal income groups, or quintiles, from the lowest 20% to the highest 20%.
By tracking these movements, we can answer key questions. For instance, what percentage of children born into the bottom quintile successfully climb to the top quintile? This kind of analysis reveals patterns of opportunity across a society.
What Drives Mobility?
A person’s journey up or down the economic ladder is influenced by a combination of factors. Some are personal, while others are built into the fabric of society.
Family and Background: The resources a child's family has, including income, wealth, and social connections, provide a crucial starting point. Parental education level is also a strong predictor of a child's future success.
Education: Access to high-quality education, from early childhood through college, is one of the most powerful engines of social mobility. It equips individuals with the skills and knowledge needed to secure better-paying jobs.
Neighborhood: Where you grow up matters. Factors like school quality, community safety, local job markets, and even the level of social cohesion can have a lasting impact on a person's life trajectory.
Economic and Government Policies: Policies related to taxation, wages, and social safety nets can either help or hinder mobility. For example, a higher minimum wage can boost incomes for low-wage workers, while investments in job training can open up new career paths.
The U.S. Picture
While the United States is often called the "land of opportunity," the data on social mobility tells a more nuanced story. Compared to many other developed countries, the U.S. has lower rates of relative mobility. This means a person's economic standing is more closely tied to their parents' income than in countries like Canada or Denmark.
Furthermore, mobility varies significantly across the country. Some regions and cities offer much better odds of climbing the income ladder than others. Disparities also exist across racial and ethnic groups, with historical and ongoing systemic barriers impacting opportunities for many.
Absolute mobility—the chances that a child born into poverty rises to a higher standard of living—across generations has been in continuous decline in the U.S. since 1980, according to Opportunity Insights.
This decline in absolute mobility means that fewer Americans today are earning more than their parents did. Understanding these trends is the first step toward addressing the challenges and working to ensure that opportunity is available to everyone, regardless of where they start.
Which of the following best defines social mobility?
What is the primary difference between absolute and relative mobility?