- Joined
- Dec 20, 2009
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Interesting - and heartening.
Important lesson, ya'll. Someone else doing well doesn't mean you are held back from doing the same
.
The best evidence linking inequality per se with stagnating upward mobility is the “Great Gatsby” curve, popularized by Professor Alan Krueger in a speech last year. The chart shows a very direct correlation between the level of inequality in a country and inelasticity of incomes:
...That said, I’ve always doubted the utility of Krueger’s Gatsby curve. First, as Scott Winship noted in a piece in this space, the relationship Krueger documents depends on studies with widely varying methodologies. Moreover, it’s always struck me as a bit of an apples-to-oranges comparison: Norway is a different country with different demographics and a different culture. The Gatsby chart, with one fell swoop, reduces those differences to a single liberal talking point. That’s a reasonable tactic if you want to score political points; it’s virtually useless if you want to understand what drives economic immobility (which, again, is too high)....
I always wondered what an apples-to-apples comparison might look like – whether, for example, inequality in U.S. cities is related to economic mobility in those cities. But until recently, we didn’t have the data to make that comparison. Thanks to the Equality of Opportunity study by Professors Raj Chetty and Emmanuel Saez, we now do.
The study’s authors measured economic mobility in over 750 “commuting zones” across the country. These CZs map closely onto Census-defined metropolitan areas, with slight variations. So I decided to make a chart of my own comparing the absolute upward mobility in a given CZ with the inequality in the metropolitan area. I’ll admit that after the chattering classes erupted over the Krueger chart, I expected at least some relationship between inequality and upward mobility. So what I found was striking:
In short, in our 48 largest metro areas, there is no meaningful relationship between inequality and upward mobility....
If Krueger’s chart is the Great Gatsby curve, then this is the small Gatsby curve. But the small Gatsby curve has the advantage of comparing things that are actually somewhat alike – specifically, large, densely populated urban areas. And when you do that, the “strong, negative relationship” between upward mobility and inequality disappears.
Let me emphasize that this doesn’t mean we should ignore upward mobility or the fact that America could use a lot more of it. It does, however, show that the Left’s obsession with inequality is a distraction from the real issue. Inequality is an inevitable consequence of living in a society with people of different aptitudes and ambitions. Upward mobility, on the other hand, is about the American Dream. And the connection between the two is tenuous at best....
Important lesson, ya'll. Someone else doing well doesn't mean you are held back from doing the same
.
