Is There a Causal Effect?

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There's enormous variation within the country and even within neighborhoods. The other thing to think about is a reverse causation or selectivity, selection bi asison. We see very clear evidence that if you move to the higher places at a younger age, kids do better. To go back to my earlier example, certain parts of ala we see higher levels of upward ability than other parts. And so are we seeing differences based on the age at which kids move? Looking at siblings within families, for instance, and the answer is yes.

Economist Raj Chetty of Harvard University talks about his work on economic mobility with EconTalk host Russ Roberts. The focus is on Chetty's recent co-authored study in Nature where he finds that poor people in America who are only connected to other poor people do dramatically worse financially than poor people who are connected to a wider array of economic classes. The discussion includes the policy implications of this result as well as a discussion of Chetty's earlier work on the American Dream and the challenge of Americans born in recent decades to do better financially than their parents.