Severe Inequality Is Incompatible With the American Dream
Why extreme wealth makes it hard for people to do better than their parents did
Image credit: Tony Gutierrez / AP
The numbers are sobering: People born in the 1940s had a 92 percent chance of earning more than their parents did at age 30. For people born in the 1980s, by contrast, the chances were just 50-50.
The finding comes from a new paper out of The Equality of Opportunity Project, a joint research effort of Harvard and Stanford led by the economist Raj Chetty. The paper puts numbers on what many have seen firsthand for years: The American dream—the ability to climb the economic ladder and achieve more than one’s parents did—is less and less a reality with every decade that goes by.
There are two main reasons why today’s 30-somethings have a harder time than their parents did, according to the authors.