Income Inequality, Equality of Opportunity, and Intergenerational Mobility

Bibliographic Data

ID4029019
AuthorsMiles Corak (Professor of Economics, University of Ottawa, Ottawa, Canada, and Research Fellow, Institute for the Study of Labor (IZA), Bonn, Germany., corresponding author)
Year2013
Volume27
Issue3
Pages79-102
Publication date2013-08-01
Peer ReviewedYes
Open AccessYes
TypeARTICLE
VenueThe Journal of Economic Perspectives (JOURNAL)
Journal identifiersISSN: 0895-3309 • E-ISSN: 1944-7965
PublisherAmerican Economic Association (PUBLISHER • US)
DOI10.1257/jep.27.3.79
OpenAlexW2122216841
LanguageEN
Citations received531
References cited27

My focus is on the degree to which increasing inequality in the high-income countries, particularly in the United States, is likely to limit economic mobility for the next generation of young adults. I discuss the underlying drivers of opportunity that generate the relationship between inequality and intergenerational mobility. The goal is to explain why America differs from other countries, how intergenerational mobility will change in an era of higher inequality, and how the process is different for the top 1 percent. I begin by presenting evidence that countries with more inequality at one point in time also experience less earnings mobility across the generations, a relationship that has been called "The Great Gatsby Curve." The interaction between families, labor markets, and public policies all structure a child's opportunities and determine the extent to which adult earnings are related to family background-but they do so in different ways across national contexts. Both cross-country comparisons and the underlying trends suggest that these drivers are all configured most likely to lower, or at least not raise, the degree of intergenerational earnings mobility for the next generation of Americans coming of age in a more polarized labor market. This trend will likely continue unless there are changes in public policy that promote the human capital of children in a way that offers relatively greater benefits to the relatively disadvantaged

Demographic economics · Disadvantaged · Earnings · Economic growth · Economic inequality · Economic mobility · Economics · Human capital · Inequality · Labour economics · Political science · Poverty · Public policy · Social mobility · Income, Poverty, and Inequality · Intergenerational and Educational Inequality Studies · Labor market dynamics and wage inequality

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Open DOISci-HubOpen Access