Two recent studies by the research team of the Equality of Opportunity Project, economists Raj Chetty, Nathaniel Hendren, Patrick Kline, Emmanuel Saez, and Nicholas Turner, provide new evidence on the state of intergenerational income mobility in America. Using administrative earnings records, Chetty and team find that, for the 1971-1993 birth cohorts, the probability of advancing to a higher percentile of the income distribution relative to that of one’s parents has not changed. But, over this same period of time, the gaps between the different percentiles have widened; in other words, income inequality has increased.
The strongest predictor of intergenerational mobility, the researchers find, is family structure. Specifically, they report that “The fraction of children living in single-parent households is the strongest correlate of upward income mobility among all the variables we explored, with a raw unweighted correlation of -0.76”. Interestingly, the researchers point out that the effect of family structure is explained as both an individual-level and community-level effect. That is, the findings suggest that not only does the stability of an individual family affect children’s outcomes, but the stability of the social environment does so as well.
See “Is the United States Still a Land of Opportunity? Recent Trends in Intergenerational Mobility” and “Where is the Land of Opportunity? The Geography of Intergenerational Mobility in the United States”