Why Economic Mobility Is Stuck in Neutral

Jan. 28 (Bloomberg) -- We are seeing an outpouring of newempirical work on inequality, led by the economists Raj Chettyof Harvard University and Emmanuel Saez of the University ofCalifornia at Berkeley. The findings in their two latest papers,written with several co-authors, are casting a fresh light oncontemporary political debates.

Perhaps their most striking finding is that in the U.S.,intergenerational mobility has remained essentially static forabout 50 years. Their own evidence focuses on people bornbetween 1971 and 1993. Consider, for example, the probabilitythat children who are born in the nation’s bottom fifth will endup (by their late 20s) in its top fifth. For those born in 1971,the probability is about 8.4 percent; for those born in 1986, itis about 9 percent.