• More than 70 percent of those in the top income quartile as adults were in the top two income quartiles as children, with 44 percent of them having been in the very top quartile.
• Similarly, 45.9 percent of those in the bottom quartile as adults had been in the bottom quartile as children, and 70.9 percent of those in the bottom quartile as adults had been in the lower half of the income distribution as children.

• A child from the highest income quartile is almost five times as likely to graduate from college as a child from the lowest income quartile.
• On average, individuals whose parents worked in high-status occupations will earn $85,719 and have 13.27 years of education, and 55.4 percent are working in high-status occupations themselves.
• Conversely, individuals from families where there was no parental worker will earn $38,104 and have 11.98 years of education, and 23.8 percent are in high-status occupations. Individuals whose parents worked in low-status occupations have an income of $50,386 and 12.19 years of education, and 23.7 percent are in high-status occupations.

Moving On Up?

Economics professor examines social mobility in the United States

A substitute teacher, parole officer, history professor, economics professor and NASA engineer. What do these people have in common? They are siblings whose mother is a high school graduate and whose father is a certified public accountant with a master’s degree.

“Each of my siblings likely belongs in a different income quintile,” says Dr. Kathryn Wilson, associate professor of economics at Kent State. “But my family is an exception to the trend.”

In a recent study funded by the Russell Sage Foundation, Wilson and colleagues Timothy Smeeding at Syracuse University and Robert Haveman at University of Wisconsin-Madison examined social mobility, or the ability to move up or down the economic ladder, in the United States.

“People like to think of America as the land of opportunities,” says Wilson. “The irony is that our country actually has less social mobility and more inequality than most developed countries.”

According to numerous studies, the United States has the highest level of income inequality among all rich nations. For example, low-income households, or those at the 10th percentile of the income distribution, spend approximately $8,900 per year per child, while high-income families, or those at the 90th percentile, spend $50,000 per child.

“Within any society, the extent to which family background predicts the economic outcomes of children is an indicator of the degree of equality in life chances, or the extent of ‘equality of opportunity,’” says Wilson.

She, Smeeding and Haveman investigated the relationship between parental socioeconomic status and offspring socioeconomic status by examining three variables: family income, education and occupation class. In September 2006, they presented the results of their study at EqualSoc in Barcelona, Spain, a conference supported by the European Union.

Their research found that parental income seems to have a large effect on offspring income. Offspring whose family income was in the lowest quartile during childhood had as adults an average household income of $40,984, compared to $95,314 for those in the top childhood income quartile. Those who grow up in families in the bottom quartile of income as children also have lower educational attainment and work in lower status occupations as adults. Half of those from families with childhood income in the upper quartile go on to work in high-status occupations, while only 21.9 percent of those from the lowest income quartile work in high-status occupations.

“The best developed country in which to be born rich is the United States, because the likelihood is that you will remain rich,” says Wilson. “However, if you’re born poor, then the United States is the worst developed country in which to be born, because you’re most likely to stay poor.”

Fifty-eight percent of those in the bottom quartile of childhood family income also are in the bottom quartile of income at age 35; in contrast, 42.4 percent of those with childhood income in the top quartile remain in the top income quartile as adults, while only 13.3 percent fall to the bottom quartile. Those in the upper middle-income quartile as children have an equal probability of ending up in any quartile as an adult, while those in the lower middle quartile as children are more likely to stay in the same quartile (28.2 percent) or move to the bottom quartile (34.8 percent), rather than move up to a higher income quartile as adults.

Family income, however, is not as strong a predictor of offspring educational attainment and occupational class as parental education and occupational class are. Wilson and her fellow researchers suggest that different educational aspirations, academic ability and lack of information about higher education may be as much of a barrier to mobility for youth as lack of income to pay for higher education.

Kent State Economics Student Selected for Research Program

Last summer, Kent State economics student Jera Oliver attended the American Economic Association Summer Program and Minority Scholarship Program at Duke University.

Oliver received a full scholarship for the program, for which she took a number of master's level courses, and was named a National Science Foundation Research Experiences for Undergraduates Scholar.

Read more about Oliver's summer of economics.

“We think of education as a great equalizer, but in reality, those who attend college come from predominantly higher-income families, and those who do not attend college tend to come from lower-income families,” says Wilson.

However, she adds, “we found that it’s not about the money it takes to go to college.” Rather, higher socioeconomic parents give their children something additional, in terms of social connections; they instill in their children an understanding of the value of education and expectations for their future, all of which encourages them to attain higher educational levels. Lower socioeconomic families do not pass along those same values and expectations, Wilson says.

“There is no doubt that education is still a way for an individual to move up the economic ladder, but the education system as a whole continues to reinforce the social classes,” she says. Therefore, she suggests that government or educational policymakers should concentrate on giving low-income children a better chance in terms of family expectations and education in order to improve intergenerational mobility in the United States.

“If it’s about money, then we need more financial aid,” says Wilson. “But if the difference in educational attainment is due to parental expectations, then we need to figure out how to address that in families where the expectation doesn’t exist.”

In the future, Wilson and her colleagues hope to better quantify how other channels besides education affect social mobility. Specifically, she would like to examine the role of an offspring’s choice of occupation and assortative mating (marrying within a similar economic class), in social mobility.

Says Wilson: “As inequality in the United States increases, it’s important to look at how mobile society is and what causes or impedes social mobility.”