Friday, March 21, 2014

Interesting result on economic mobility

Source: Pew Research Center
Planet Money used data from the National Longitudinal Surveys, which has been following a nationally representative sample of 12,686 men and women since 1979, when they were 14 to 22 years old. For those in 30 occupational categories (chosen because “we thought [they] would be interesting and understandable”), Planet Money plotted their current income against their median family income in 1979, adjusted for inflation.
There may be a bias in the data. Police officers and fire fighters may be paid a risk premium, and may have shorter working lives, and as a consequence lower lifetime earnings that people with jobs requiring similar training and experience but without comparable risk.

The upper income seem to be reserved for knowledge workers, whose families were generally in the upper middle class. However, knowledge workers may have longer and more expensive training, and thus less disposable lifetime income than would appear from the graph.

Still, the general trend is clear -- there is not as much mobility in American society as we think. Poor families produce new generations of low paid workers; well to do families produce new generations of well paid workers.

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