Raj Chetty’s new paper on changes in opportunity

Here is the paper, with co-authors Will Dobbie, Benjamin Goldman, Sonya R. Porter, and Crystal S. Yang. Here is the abstract:

We show that intergenerational mobility has changed rapidly by race and class in recent decades and use these methods to study the underlying mechanisms of changes in economic mobility. For white children in the US born between 1978 and 1992, earnings increased for children from high-income families but decreased for children from low-income families, widening the income gap by parental (“class”) income by 30%. The earnings of black children increased at all levels of parental income, narrowing the white-white income gap for children from low-income families by 30%. Class gaps widened and racial gaps similarly narrowed in non-monetary outcomes such as educational attainment, standardized test scores, and death rates. Using an exploratory design, we show that different trends in economic mobility are caused by different changes in children’s circumstances, as they relate to parental employment levels, within local communities defined by the children’s race, class, and region. Outcomes improve across birth cohorts for children who grow up in communities with rising levels of parental employment, with larger effects for children who move to such communities at an early age. Children’s outcomes are strongly related to parental employment levels of peers with whom they are most likely to interact, such as those in their birth cohort, suggesting that the relationship between children’s outcomes and parental employment levels is mediated by social interactions. [emphasis added]. Our findings imply that changes at the societal level in one generation can spread to the next generation and thus cause rapid changes in economic flows.

Here’s the NYT coverage, here’s the WSJ coverage.



Source link