[A] 36-year-old India-born economist [Raj Chetty] has a different explanation [for the shrinking middle class]: Bad neighborhoods and bad teachers rob poor children of the chance to climb into the middle class.
His solution? Help the children and their families move to better neighborhoods.
His research finds that upward mobility depends on government policies, a position common among Democrats, as well as on neighborhood churches and two-parent families, as Republicans contend.
“Chetty’s work challenges preconceived notions on both sides” of the political divide....
Mr. Chetty and the economists he works with tackle problems that seem intractable, and offer hopeful prescriptions. Consider economic inequality—the income spread between rich, middle-class and poor. Mr. Chetty addresses the issue indirectly. He examines income mobility, which he defines as the ability to rise from the lowest 20th percentile of income distribution to the top 80th percentile in one generation. Climbing that ladder is more important than ever, he says, because the distance between the economic classes is greater than in the past .
By analyzing tax records of families in 741 geographic districts, he pinpoints hotbeds of opportunity....High-mobility metro areas have a combination of greater economic and racial integration, better schools and a smaller fraction of single-parent families than lower-mobility areas....“The strongest predictors of upward mobility are measures of family structure,” Mr. Chetty said.
His [two-pronged] proposal: move poor children to high-mobility communities and remove the impediments to mobility in poor-performing neighborhoods.
“The view that we’ll fix the American dream at the national level is probably not the right way to look at the problem,” he said.
