Social science is on the cusp of a revolution as the introduction of big data is allowing us to measure social ills and inequality, as well as evaluate taxpayer-funded social programs that have been long on promise but short on objective results.
And so I was intrigued to be invited as a delegate to an historic three-day conference at Stanford called “Frontiers of Social Innovation,” featuring pioneers in the new paradigm of massive demographic datasets finding hidden trends. The first day included a presentation and discussion with economist Raj Chetty, a MacArthur Fellow whose 2015 research paper mitigated what had been an unmitigated disaster for social scientists.
The Moving to Opportunity (MTO) study authorized by Congress in 1992 offered 4,600 low-income, mostly African-American families with children the opportunity to move from their public housing projects to lower-poverty communities. It was expected that these families would benefit mightily from the better schools, greater job opportunities and reduced crime of their new surroundings. But 15 years after the move, other than some improvement in mental health, the federal study found almost no effect on children”™s educational achievement, little effect on employment or income for the adults, and actually found more “risky behavior” among male youth. As I said, it was an unmitigated disaster for the conventional wisdom.
But in a 2015 study, Harvard’s (now Stanford”™s) Raj Chetty re-analyzed the data and found a hidden value. While the impact of a better neighborhood made little difference to the achievement of poor adults, it greatly improved the life trajectory of young children. Chetty found an inverse relationship between the age of the child at the move to measurable achievement and income gains in later life.
The improvement was striking for babies, but declined and disappeared for children who were over 12 when the move occurred. Cross-checking tax records, he found, “Children whose families take up an experimental voucher to move to a lower-poverty area when they are less than 13 years old have an annual income that is $3,477 (31 percent) higher on average relative to a mean of $11,270 in the control group in their mid-twenties.”
Chetty moved on to even bigger data than the MTO to analyze the state of the “American Dream.” Using IRS data on 5 million children born from 1980 through 1982, he was able to map the social mobility effects of every region in America.
Chetty looked at the probability that a child born to parents in the bottom 20 percent of income would get into the top 20 percent, which he calls the American dream. He found that in the U.S. today, the chances of advancement from the bottom fifth to the top fifth were only 7.5 percent. In Britain, it”™s 9 percent, and 13.5 percent for Canada. Thus, he concluded in his speech, “You are almost twice as likely to reach the American dream in Canada than the U.S.”
However, Chetty discovered, social mobility varies by region. In the Deep South, a poor child growing up in Atlanta has only a 4.5 percent chance of making it to the top fifth of income earners, while it was 18.5 percent in the San Francisco Bay area. He attributed some of the improvement to lower levels of racial and economic segregation.
Alexander Roberts is executive director of the fair housing group Community Innovations Inc., headquartered in White Plains. Contact him at aroberts@chigrants.org or 914-683-1010.
