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Posted by: Michael Mandel on May 15
Would you rather live in a society with a lot of mobility but no wage gains, or a society with a bit less mobility and good wage gains?
The authors of today’s NYT story on class would clearly prefer the former. They are quite happy to cite data that there was somewhat less mobility in the 1990s. But the rise in wages in the same decade is dismissed, with a wave of the hands, as being due the “speculative bubble of the 90’s.”
Moreover, the story makes a big deal that intergenerational mobility has fallen, but cites only one study which actually shows that. The other studies that the story cites—about the movement of families up and down the income ladder over the course of a decade—have nothing to do with intergenerational mobility.
My view: The rise in wages was far more important, in terms of people’s well-being, than the slight decrease in mobility could possibly be. Moreover, the apparent decrease in mobility may simply be a temporary blip in the data, associated with the late 1990s boom.
Michael Mandel, BW's award-winning chief economist, provides his unique perspective on the hot economic issues of the day. From globalization to the future of work to the ups and downs of the financial markets, Mandel-named 2006 economic journalist of the year by the World Leadership Forum-offers cutting edge analysis and commentary.