If there has been one casualty of the Great Recession, it's the "American dream "– the idea that no matter where you come from, everyone has a fair shot at a good life.
Study after study has painted a picture of a much different reality, but none has been as clear as a new report on income mobility out of Harvard University this week.
In "The Economic Impacts of Tax Expenditures," researchers looked at how economic and social factors impacted the upward mobility of children raised in the 1980s and 1990s.
Above all, family life and the social structure offered by religious beliefs played the most pivotal role in children's outcomes.
"For instance, high upward mobility areas tended to have higher fractions of religious individuals and fewer children raised by single parents," the researchers write. "Each of these correlations remained strong even after controlling for measures of tax expenditures."
There were other factors contributing positively to upward mobility. In areas where poor people were segregated from the middle class, researchers found children had a lesser chance of moving up the income ladder, the found.
A good school system also helped. Wherever school children scored highest on standardized testing and school districts spent more per student, dropout rates were lower and children had higher rates of income mobility.
On the flip side, they found that tax credits for the poor and higher taxes on the wealthy actually played a much smaller role in improving the lives of their children over time.
The researchers downplayed the role of geography in dictating upward mobility, but there were some regional trends. Regions in the Southeast and Midwest were found to be toughest for upward mobility, including cities like Atlanta, Charlotte and Cincinnati (see map above). Kids living in Northeast and Western cities like New York, Boston and Seattle had better odds of moving up.
So where do we go from here?
If you're an Atlanta parent with teenagers at home, moving them to another city or state won't really do much good. The researchers found that after the age of 13, moving didn't do much to improve children's chances at higher income mobility. And switching neighborhoods matters significantly less as children get older, as well.
The researchers signed off on the study with this big fat disclaimer:
"We caution that all of the findings in this study are correlational and cannot be interpreted as causal effects. What is clear from this research is that there is substantial variation in the United States in the prospects for escaping poverty...Understanding the features of these areas – and how we can improve mobility in areas that currently have lower rates of mobility – is an important question for future research that we and other social scientists are exploring."
They're being a little humble here. Study after study has seemed to confirm their findings over the last decade or so. Most recently, a telling report by Washington, D.C.-based think tank, The Hamilton Project, highlighted economic data that showed how income inequality factored deeply into children's' social mobility in America. In that report, they drove home the notion that access to education and a sound family structure also gave children the best shot at winding up better off than their parents.
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