Reducing Intergenerational Poverty (2024) / Chapter Skim
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2 A Demographic Portrait of Intergenerational Child Poverty
2 A Demographic Portrait of Intergenerational Child Poverty
Pages 39-60
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From page 39... ...
And because the data cover the entire population, they can describe the intergenerational fortunes of different racial and ethnic groups as well as the trajectories of children of immigrants from all parts of the globe. The chapter then turns to geographic differences in mobility out of a low-income childhood across the United States -- shedding light on the geographic correlates of intergenerational poverty -- and examines how the structure of intergenerational mobility has changed over time.
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From page 40... ...
. Most of our data on intergenerational poverty and mobility come from a much larger study that provides a wealth of population-wide information about intergenerational mobility out of low-income status defined by income reported on Internal Revenue Service tax (IRS)
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From page 41... ...
But instead of measuring economic status in adulthood by household income, we use the individuals' own earnings. This approach reveals some noteworthy gender differences in adult earnings for certain racial and ethnic groups and provides a more nuanced portrait of intergenerational mobility than one based only on household income.
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From page 42... ...
NOTES: This figure shows the percentage of children with low family incomes in childhood who also have low incomes in adulthood based on both absolute and relative measures of low-income status. Absolute poverty data come from the PSID; absolute poverty is measured by whether cash plus in-kind income is below the Official Poverty Measure threshold between ages 0 and 10 (childhood)
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From page 43... ...
of Native American children and 37% of Black children who grow up in low-income households remain poor in adulthood.4 All 34% White 29% Asian 17% Latino 25% Black 37% Native 46% American 0% 10% 20% 30% 40% 50% % staying low-income FIGURE 2-2 Intergenerational low-income persistence, by racial and ethnic group. NOTES: This figure shows the percentage of children with parents in the bottom income quintile who remained in the bottom income quintile in adulthood, by racial/ ethnic group.
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From page 44... ...
In contrast to the focus on low-income persistence in prior figures, Figure 2-4 shows rates of upward mobility for male children using both adult earnings and household income, defined as earnings or household income in the top 60% of their respective distributions. As before, all the data presented in this figure are for children born between 1978 and 1983 and with parental family incomes below the 20th percentile while they were growing up.
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From page 45... ...
rates 53% White 46% 64% Asian 61% 56% Latino 46% 37% Black 24% Native 36% American 26% 0% 10% 20% 30% 40% 50% 60% 70% Individual earnings Household income FIGURE 2-4 Intergenerational earnings and household income mobility for sons. NOTES: The figure shows the fraction of male children growing up in households with AGI in the bottom 20% of the AGI distribution whose individual earnings and household incomes in adulthood (ages 31–37)
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From page 46... ...
Black women 39% White 47% 62% Asian 69% 45% Latino 45% 39% Black 26% Native 30% American 28% 0% 10% 20% 30% 40% 50% 60% 70% Individual earnings Household income FIGURE 2-5 Intergenerational earnings and household income mobility for daughters. NOTES: The figure shows the fraction of female children growing up in households with AGI in the bottom 20% of the AGI distribution whose individual earnings and household incomes in adulthood (ages 31–37)
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From page 47... ...
A BROADER LOOK AT INTERGENERATIONAL INCOME MOBILITY ACROSS GROUPS For a more comprehensive look at intergenerational mobility across groups, it is useful to think of economic status as rungs on a 100-step ladder, with the lowest rungs corresponding to the lowest incomes and the highest rungs representing the highest incomes. Each rung corresponds to a percentile in the income distribution.
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From page 48... ...
As a result, Chapter 3 examines the histories, practices, and contexts that limit the intergenerational mobility of both Black and Native American children. Conclusion 2-2: Racial/ethnic disparities are an enduring feature of the intergenerational trajectories of children, with Black and Native American children experiencing much less upward mobility than White children growing up in the same economic circumstances.
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From page 49... ...
For sons whose parental households between 1994 and 2000 ranked at the 25th percentile of the income distribution (i.e., families near the bottom of the distribution) , the figure reports the average rank of the sons' household incomes when they were ages 31 to 37.
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From page 50... ...
. The figure documents extraordinary intergenerational mobility among children of poor immigrants.
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From page 51... ...
Figure 2-8 shows national patterns of intergenerational mobility in the United States. Constructed from anonymized adult tax records for more than 10 million children born between 1980 and 1982, it shows the average likelihood that children with parents in the bottom quintile of the income distribution will be in one of the top three quintiles in adulthood (Chetty et al., 2014a)
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From page 52... ...
(2020) show that, on average, Black children and Native American children in the United States have much lower rates of upward mobility (and higher rates of downward mobility)
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From page 53... ...
Child income is measured as mean AGI household income in 2011–2012, and parent income is measured as mean AGI household income in 1996–2000. Children are from the 1980–1982 birth cohorts and are assigned to the commuting zones where they grew up.
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From page 54... ...
Child income is measured as mean AGI household income in 2014–2015, and parent income is measured as mean AGI household income in 1994–2000. Children are from the 1978–1983 birth cohorts and are assigned to the census tracts where they grew up.
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From page 55... ...
The spatial patterns of economic mobility vary by racial/ethnic group; nonetheless, disparities in economic mobility between Black and White children persist even within neighborhoods. INTERGENERATIONAL MOBILITY: TRENDS AND COMPARISONS WITH OTHER COUNTRIES Regardless of whether the amounts of intergenerational mobility out of low-income status shown in Figures 2-1 and 2-3 are perceived to be large or small, it is useful to examine how mobility rates have changed over time and how they compare in the United States and other countries.
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From page 56... ...
To adjust for the fact that family incomes tend to grow with time, both parent and child household incomes are measured when earners are around age 30. Figure 2-10 shows their results for birth cohorts every 10 years, beginning
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From page 57... ...
This measure is calculated using children's and parents' marginal income distributions estimated using the Current Population Survey and decennial U.S. Census for the 1940–1984 birth cohorts, and a rank-rank copula estimated using tax records for the 1980–1982 birth cohorts, which is then applied to all cohorts from 1940 to 1984.
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From page 58... ...
In this sense, changes in inequality -- particularly the relative stagnation of wages at the bottom of the income distribution in the United States over the past 40 years -- are central to understanding the decline of absolute upward mobility. INTERGENERATIONAL MOBILITY IN THE UNITED STATES VERSUS OTHER COUNTRIES We conclude our portrait with an international comparison.
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From page 59... ...
A DEMOGRAPHIC PORTRAIT OF INTERGENERATIONAL CHILD POVERTY 59 Conclusion 2-5: After declining over the past 75 years, the fraction of children doing better than their parents is now lower in the United States than in most other industrialized countries. The most likely cause is that gains from economic growth have been disproportionately en joyed by higher-income families, which has made it even more difficult for those at the bottom rungs of the income distribution to work their way up.
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