It’s not the inequality, it’s the mobility

My latest column for The Upshot, at the NYT, is here.  Here is one excerpt:

Data from the Economic Report of the President [p.34] suggests that if productivity growth had maintained its pre-1973 pace, the median or typical household would now earn about $30,000 more today. Those higher earnings would constitute a form of upward mobility. For purposes of comparison, if income inequality had maintained its pre-1973 trend, the gain for the median household would be about $9,000 in income this year, a much smaller figure.

Those changes in productivity and inequality trends aren’t entirely separate, but accelerating the growth of productivity has the potential to do more for upward economic mobility than redistributing money from the top 1 percent.

And this:

In the book “Equality for Inegalitarians,” George Sher, a professor of philosophy at Rice University, argues that the equality we should care most about is giving everyone a chance to “live effectively.” Most of all that means ensuring that people have enough for their daily needs. We can tolerate many of the inequalities that arise above this minimum income level, provided there is protection on the downside and plenty of opportunities for those who are economically ambitious.

Read Sher, Harry Frankfurt’s excellent forthcoming book On InequalityDerek Parfit on equality and priority (pdf) and Huemer on Parfit (pdf).  Read about prioritarianism more generally.  I come away from these writings with the view that the current moral focus on inequality is a flat-out mistake in moral philosophy, analogous to how the philosophers sometimes make mistakes in economics.  That’s right, not a difference in values but a mistake.  (The difference in values, to the extent there is one, should be over the strength of our obligations to those at the bottom.)

This discussion of education provides another good example of how all this matters: if we successfully elevate people at the bottom, we don’t have to “fix” inequality.

A number of Twitter (and other) responses to my column are confusing several kinds of mobility: a) how many people from the bottom are elevated by how much, with b) what is the chance of people rising further quintiles?, and c) what is the intergenerational transmission of income and other variables?  It’s a) that matters, as b) and c) run into many of the same problems that inequality notions do.

I also am not impressed by the “Gatsby Curve” observation that inequality and mobility (some kinds, some of the time) are correlated.  Lots of things are correlated, but the question is what matters practically and morally.

By the way, here are estimates on how immigration might affect the Gini coefficient (pdf).  I find that egalitarians have a hard time developing consistent intuitions about immigration.

Interfluidity offers a very different view from mine.  Alex has much to say as well.  Here is Schneider and Winship on the Gatsby Curve.

Here is my conclusion:

It is quite possible the future will bring higher levels of income inequality, which will undoubtedly distress many commentators. But we are likely to be better off if we keep our eye on the ball, identify what really helps people the most and do whatever we can to increase economic mobility. That is a practical program that we all should be able to endorse.


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