Growing inequality has made the American ‘rags to riches’ story more myth than reality. ….
….If you work hard and play by the rules you will get ahead, according to the American Dream. But working hard and playing by the rules now feels like running in place to a lot of Americans. The past few years of economic data justify their complaint: Most of the productivity gains in the U.S. economy have been captured by the top 1 percent, and most working Americans have seen their standard of living plateau rather than rise.
Economic stratification has spurred politically explosive resentments. And these resentments have encouraged economists to seek a better understanding of economic mobility – or the lack thereof. Is America still a land of opportunity despite rising inequality? And is education – often hailed as the key to getting ahead – still an important part of the solution?….
The Decline in Lifetime Earnings Mobility in the U.S.: Evidence from Survey-Linked Administrative Data
Source: Michael D. Carr, Emily E. Wiemers, Washington Center for Equitable Growth, May 2016