Class, race and the chances of outgrowing poverty in America

The Economist:

A new study by Raj Chetty, of Harvard University, and colleagues provides fresh data on how America’s landscape of opportunity has shifted sharply over the past decades. Although at the national level there have been only small declines in mobility, the places and groups that have become more (or less) likely to enable children to rise up have changed a lot. The most striking finding is that, compared with the past, a child’s race is now less relevant for predicting their future and their socioeconomic class more so.

The greatest drops in mobility have been not in the places evoked in song, but on the coasts and the Great Plains, which historically provided pathways up (see maps). “Fifteen years ago, the American Dream was alive and well for white children born to low-income parents in much of the North-east and West Coast,” says Benjamin Goldman of Cornell University, one of the co-authors. “Now those areas have outcomes on par with Appalachia, the rustbelt and parts of the South-east.”

The fact that white children have become more likely to remain in poverty than before, whereas for black children the reverse is true, raises many questions. The finding comes from tracing the trajectories of 57m children born in America between 1978 and 1992 and looking at their outcomes by the age of 27. “This is really the first look with modern big data into how opportunity can change within a place over time,” says Mr Goldman. For children born into high-income families, household income increased for all races between birth cohorts. Yet among those from low-income families, earnings rose for black children and fell for white children.