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America is no less socially mobile than it was a generation ago

economist.com

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Re: America is no less socially mobile than it was a generation ago

#21

One thing to be aware of is that the range of incomes in many countries is much more compact than the US. If you define social mobility by the ability to move from the bottom segment to the top, it requires a much smaller change in income in most industrialized countries than in the US. For example, for the average person in Denmark to go from the bottom 10% to the top 10% of income requires earning a mere $40k more…

So most people would prefer to live in a country with a massive income inequality? I don't think that's true.

Re: America is no less socially mobile than it was a generation ago

#22

Earlier quoted context omitted.

Actually, the studies adjust the incomes for purchasing power parity, so it is not just nominal income. Costs of living and similar are built into the relative income quintiles and deciles when comparing between countries. The US also has a wider income range because of the enormous differences in cost of living within the country itself, in large part due to its size, which skews the result. The top quintile in one…

Yes, after reading the article I'm not sure how they correct for the stark differences between places. Are the quintiles done locally or nationally? If they're done locally, then people who migrate are a problem for the statistics: it's very easy to move from bottom quintile to top quintile, just move from Palo Alto to rural Oklahoma. Or by excluding people who migrate, perhaps there are skewed effects. But if the qu…

One of the criticisms of the study is just this point. A lot of the "upward mobility" is people moving to more expensive areas where they get somewhat higher pay but the cost of living is much higher. They may well be worse off, but in $USD terms they have moved up.

Re: America is no less socially mobile than it was a generation ago

#23
post #8

Earlier quoted context omitted.

What proportion of the richest 1% (or 0.1%, or the top 1000 richest people) do you think came from families that were already in the top 1%? How do you define "out of reach"?

85% of American millionaires are self-made. Source: "The Millionaire Next Door"

But probably mostly not from the bottom quintile, which means this doesn't show up much in income mobility discussions.

Re: America is no less socially mobile than it was a generation ago

#24

One thing to be aware of is that the range of incomes in many countries is much more compact than the US. If you define social mobility by the ability to move from the bottom segment to the top, it requires a much smaller change in income in most industrialized countries than in the US. For example, for the average person in Denmark to go from the bottom 10% to the top 10% of income requires earning a mere $40k more…

So most people would prefer to live in a country with a massive income inequality? I don't think that's true.

Most rich people seem to want it that way.

Re: America is no less socially mobile than it was a generation ago

#25
From the paper: For example, if one defines mobility based on relative positions in the income distribution – e.g., a child’s prospects of rising from the bottom to the top quintile – then intergenerational mobility has remained unchanged in recent decades. If instead one defines mobility based on the probability that a child from a low-income family (e.g., the bottom 20%) reaches a fixed upper income threshold (e.g., $100,000), then mobility has increased because of the increase in inequality. However, the increase in inequality has also magnified the difference in expected incomes between children born to low (e.g., bottom-quintile) vs. high (top-quintile) income families. In this sense, mobility has fallen because a child’s income depends more heavily on her parents’ position in the income distribution today than in the past.

Re: America is no less socially mobile than it was a generation ago

#26

Earlier quoted context omitted.

Actually, the studies adjust the incomes for purchasing power parity, so it is not just nominal income. Costs of living and similar are built into the relative income quintiles and deciles when comparing between countries. The US also has a wider income range because of the enormous differences in cost of living within the country itself, in large part due to its size, which skews the result. The top quintile in one…

Yes, after reading the article I'm not sure how they correct for the stark differences between places. Are the quintiles done locally or nationally? If they're done locally, then people who migrate are a problem for the statistics: it's very easy to move from bottom quintile to top quintile, just move from Palo Alto to rural Oklahoma. Or by excluding people who migrate, perhaps there are skewed effects. But if the qu…

Given that physical mobility is down in the US, this means that income mobility for reasons other than physical mobility must have increased.

http://www.nytimes.com/2013/12/15/magazine/why-are-so-many-a...

Re: America is no less socially mobile than it was a generation ago

#27
post #14

One thing to be aware of is that the range of incomes in many countries is much more compact than the US. If you define social mobility by the ability to move from the bottom segment to the top, it requires a much smaller change in income in most industrialized countries than in the US. For example, for the average person in Denmark to go from the bottom 10% to the top 10% of income requires earning a mere $40k more…

> In short, there are many countries where moving from $20k to $40k is considered "socially mobile" but also others where moving from $20k to $60k income is not because the top bracket is $80k. Most people would probably prefer to live in the latter country. I don't think that's actually true. Having the rich be a lot richer has a lot of sociological impacts, particularly within a democracy.

Empirical evidence is not on your side here considering net immigration from Mexico to the US (or many other poor country / rich country pairs).

Re: America is no less socially mobile than it was a generation ago

#28
post #27
post #14

Earlier quoted context omitted.

> In short, there are many countries where moving from $20k to $40k is considered "socially mobile" but also others where moving from $20k to $60k income is not because the top bracket is $80k. Most people would probably prefer to live in the latter country. I don't think that's actually true. Having the rich be a lot richer has a lot of sociological impacts, particularly within a democracy.

Empirical evidence is not on your side here considering net immigration from Mexico to the US (or many other poor country / rich country pairs).

There is a big difference between the medians in those two places. I'm thinking more like the U.S. versus European countries.

Re: America is no less socially mobile than it was a generation ago

#29
post #24

Earlier quoted context omitted.

So most people would prefer to live in a country with a massive income inequality? I don't think that's true.

Most rich people seem to want it that way.

Most people aren't rich.

"America is the wealthiest nation on Earth, but its people are mainly poor, and poor Americans are urged to hate themselves. To quote the American humorist Kin Hubbard, “It ain’t no disgrace to be poor, but it might as well be.” It is in fact a crime for an American to be poor, even though America is a nation of poor. Every other nation has folk traditions of men who were poor but extremely wise and virtuous, and therefore more estimable than anyone with power and gold. No such tales are told by the American poor. They mock themselves and glorify their betters. The meanest eating or drinking establishment, owned by a man who is himself poor, is very likely to have a sign on its wall asking this cruel question: “if you’re so smart, why ain’t you rich?” There will also be an American flag no larger than a child’s hand—glued to a lollipop stick and flying from the cash register.

Americans, like human beings everywhere, believe many things that are obviously untrue. Their most destructive untruth is that it is very easy for any American to make money. They will not acknowledge how in fact hard money is to come by, and, therefore, those who have no money blame and blame and blame themselves. This inward blame has been a treasure for the rich and powerful, who have had to do less for their poor, publicly and privately, than any other ruling class since, say Napoleonic times. Many novelties have come from America. The most startling of these, a thing without precedent, is a mass of undignified poor. They do not love one another because they do not love themselves."

— Kurt Vonnegut (1922–2007)

Re: America is no less socially mobile than it was a generation ago

#30
post #27
post #14

Earlier quoted context omitted.

> In short, there are many countries where moving from $20k to $40k is considered "socially mobile" but also others where moving from $20k to $60k income is not because the top bracket is $80k. Most people would probably prefer to live in the latter country. I don't think that's actually true. Having the rich be a lot richer has a lot of sociological impacts, particularly within a democracy.

Empirical evidence is not on your side here considering net immigration from Mexico to the US (or many other poor country / rich country pairs).

Yeah, let's ignore Canada and all the European countries.
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