Decades of rising income inequality and slowing economic growth have eroded a pillar of the American dream: the hope that each generation will do better than the one that came before, according to new research released Thursday.
If the findings hold up, they have profound economic, social and even political implications. The decline in what economists call “mobility” — how easy it is to move up the income ladder over a lifetime or across generations — has been especially stark in the Rust Belt states that helped propel Donald Trump to victory in last month’s presidential election.
In 1970, according to the research, conducted by Stanford economist Raj Chetty and several co-authors, roughly nine out of every 10 American 30-year-olds earned more than their parents did at the same age, after adjusting for inflation. In 2014, only half of 30-year-olds could say the same.1 The slowdown in mobility shows up in all 50 states and is true across the income spectrum. The biggest declines were among the children of middle-class families. Read more.