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Upward Income Mobility & Shale Production: A Causal Connection? [Part 2]

Contributor: Cody Davis
Posted: 08/19/2013
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Summary of Findings

Many researchers believe this study to be the most detailed portrait of income mobility in the United States because it is the first analysis of its kind to utilize sufficient data to compare upward mobility across metropolitan areas.

Here are some of the key findings from the study:

  • The odds that children will climb the income ladder were remarkably lower in Atlanta, Charlotte, Memphis, Raleigh, Indianapolis and Columbus.
  • Children from New York, Boston, Salt Lake City, Pittsburgh, Seattle and communities in California and Minnesota had a better chance of becoming a top earner.
  • Larger tax credits for the poor and higher taxes on the wealthy contributed to only a slight improvement in income mobility.
  • The researchers uncovered only a slight correlation between mobility and the number of local colleges and their respective tuition rates, as well as the amount of hyper wealth in a region.
  • All other factors being equal, upward mobility tended to be higher in metropolitan areas where low-income families were more evenly dispersed and living in mixed-income neighborhoods.
  • Income mobility was also greater in regions with higher saturation rates of two-parent households, better elementary schools and high schools, and higher levels of civic engagement such as religious membership and community organizations.
  • Children who moved at a young age from a low mobility area to a high mobility area did almost as well as those who spent their entire childhood in a higher mobility area.

The team that conducted the study stresses that the information they gathered allowed them to only identify correlations, not causation factors. Other economists expect future studies to be an important factor in better understanding the patterns of the new data revealed by the study.

So the question remains: What is the driving force that is helping children raised in a family in the lower income quintile rise into the top income quintile?

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Contributor: Cody Davis