A must read on the perceptions of social mobility

Intergenerational mobility and preferences for redistribution

This is certainly a must read for the day. To summarize, this study looks at intergenerational mobility and finds that Europeans are more pessimistic about their ability to move up in life while Americans are more optimistic. This might have to do with the class system that was prevalent in European society that never (well, never officially) existed in the U.S. The few lines below do a better job at explaining the difference:

The (stereo)typical view on intergenerational mobility distinguishes between ‘American’ and ‘European’ attitudes. Americans are thought to view the market system as relatively fair, and to believe in the ‘American dream’. Thus, they see view wealth as a reward for ability and effort, and poverty as the result of inability to take advantage of opportunities. In contrast, Europeans tend to believe that the economic system is unfair, and that wealth is the result of family history, connections, and sticky social classes. Poverty is the result of bad luck and the inability of society to take care of the needy regardless of their effort (Alesina and Glaser 2004).

And from the data:

quintile mobility

The chart above shows on the y-axis the perceived probability of moving from the bottom quintile to the top quintile against the real probability on the x-axis. Interestingly, the European countries have a better probability of moving from the bottom to the top, yet they still perceive they have a lower probability.

I also have some remarks on the survey measures below contrasted with reality:

A majority of Americans tend to believe that the economic system is fair, while French and Italian respondents have extremely negative views about the fairness of the system, and show extraordinarily low levels of trust in the government regarding policies to increase opportunities. Half of US respondents agree that the system is fair, and 53% believe that everyone has a chance of making it. Only 10% and 19% of Italian and French respondents, respectively, agree that the system is basically fair. Similarly, only 13% of Americans say that they never trust the government, in comparison with 29% of Italian and 33% of French respondents.

First off, these types of survey questions can vary greatly based on external factors and perception of one’s life at the current moment in time. For instance, particularly in the U.S., giving this survey when the economy was in the doldrums of the financial crisis will yield far different results than, say, at the present. Second, the notion that half of Americans view the economic system as fair, 53% believe that everyone has a chance of making it, and only a mere 13% say they never trust the government contrasts starkly with their voting preferences this past November. Also, the definition of “making it” will vary significantly for different people. For instance, I might define “making it” as owning a nice beach house with a few overpriced cars in the garage while someone else might define “making it” as owning a home and supporting a family anywhere. And again, I must reiterate, the timing of this survey will yield drastically different results.

While intuitive, I also find the political leanings below noteworthy:

We also uncover deeply polarised views on policy. Left-leaning respondents are pessimistic about social mobility and the more pessimistic they are, the more they see a role for government in implementing equal opportunity policies, like spending more on public health and education, and financing them with more progressive income taxes. In contrast, right-leaning respondents seem to see the government as the problem rather than the solution, and even those who are pessimistic about social mobility do not want more government spending.

And lastly, the researchers conducted a survey whereby they showed respondents an animation meant to provoke more pessimistic views of social mobility. And as expected, the results were as follows:

Thus, the treatment had the effect of either ‘preaching to the choir’ or ‘preaching to the deaf.’

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