preview

Intergenerational Mobility

Better Essays

When most people (here in the US or anywhere else in the world) hear or talk about the United States, a common theme is living the “America Dream”. The “American Dream” is the idea that children will have a higher standard of living than their parents and in 1940, 92 percent of them did. But by 1980 that number decreased to 50 percent, in terms of absolute mobility. The term “successful” is a universal term and applies different for every single individual because everyone has different levels of success, some are higher then others and there can be some barriers in the way. There are many stories and evidence that have proven this theme but in the fine details there are many other things that come into play when it comes to becoming “successful”. …show more content…

The strongest factor in terms of intergenerational mobility would be income inequality, which explains for 71 percent of the decrease in absolute mobility, slowed down in overall growth rate in the entire economy explains for the other 29 percent. Family backgrounds and human capital are big factors of determining outcomes in adults and individual work seems less effective in their outcome. Typically if your born in a family with lots of money, it means you will have a lot of money etc. The families’ background can have many advantages and disadvantages in a child’s outcome. If families have more human capital they can invest more into their children. Families with high income typically have more knowledge in shaping their children with better skills and attitudes compared to children growing up in lower income families and have more disadvantages. Since standards would be lower compared to a high-income family, children have a harder time finding the proper guidance and knowledge from their peers. Also achieving higher education would be more challenging due to financial expenses. A field experiment that carried out in (2009) by Bettinger, Long, Oreopoulos and Sanbonmatstu, and showed that students that fill out a Free Application for Federal Student aid (FASFA), increases the chances of students from low income families to attend higher education. Even though financial aid would seem to solve this problem, there are …show more content…

However, when a student wants to attend college after high school, the chances of going to any school of his or her choice can seem unfair and have unequal opportunity to other peers. Unfortunately the idea of being limited to attending certain schools has a big influence in chances of becoming successful. Even though higher educations seems to have a direct path for high wages, the access to college can have reverse effects on intergenerational mobility. By limiting access from someone in a bottom percentile to have the possibility to attend a good college harms their upward mobility. In efforts to help breakdown an understanding of how education affects intergenerational mobility, a study called Mobility reports cards show significant findings. Mobility reports cards were conducted by collecting administrative data from more then thirty million college students in the years of 1999-2013. “We obtain rosters of attendance at all Title-IV accredited institutions of higher education in the U.S using de-identified data from federal income tax returns combined with data from the National Student Loan Data System. We obtain information on students’ earnings in early adulthood and their parents’ incomes from tax records.”

Get Access