Originally published in The Atlantic on September 26, 2017.
A body of research has since emerged to challenge this national story, casting the United States not as a meritocracy but as a country where castes are reinforced by factors like the race of one’s childhood neighbors and how unequally income is distributed throughout society. One such study was published in 2014, by a team of economists led by Stanford’s Raj Chetty. After analyzing federal income tax records for millions of Americans, and studying, for the first time, the direct relationship between a child’s earnings and that of their parents, they determined that the chances of a child growing up at the bottom of the national income distribution to ever one day reach the top actually varies greatly by geography. For example, they found that a poor child raised in San Jose, or Salt Lake City, has a much greater chance of reaching the top than a poor child raised in Baltimore, or Charlotte. They couldn’t say exactly why, but they concluded that five correlated factors—segregation, family structure, income inequality, local school quality, and social capital—were likely to make a difference. Their conclusion: America is land of opportunity for some. For others, much less so.
Rothstein’s new work complicates this narrative. Using data from several national surveys, Rothstein sought to scrutinize Chetty’s team’s work—looking to further test their hypothesis that the quality of a child’s education has a significant impact on her ability to advance out of the social class into which she was born.
For Rothstein, there’s no reason to assume that improving schools will be necessary or sufficient for improving someone’s economic prospects. “We can’t educate people out of this problem,” he says.
His work, like Chetty’s, is not causal—meaning Rothstein is not able to identify exactly what explains the underlying variation in his economic model. Nevertheless, his work helps to provide researchers and policymakers with a new set of background facts to investigate, and signals that perhaps they should be reconsidering some of their existing ideas. (Both Raj Chetty and his co-author Nathaniel Hendren declined to comment for this story.)
Jose Vilson, a New York City math teacher, says educators have known for years that out-of-school factors like access to food and healthcare are usually bigger determinants for societal success than in-school factors. He adds that while he tries his best to adhere to his various professional duties and expectations, he also recognizes that “maybe not everyone agrees on what it means to be successful” in life.
Rothstein is quick to say that his new findings do not mean that Americans should do away with investments in school improvement, or even that education is unrelated to improving opportunity. Certainly the more that people can read, write, compute, think, and innovate, the better off society and liberal democracy would be. “It will still be good for us if we can figure out how to educate people more and better,” he says. “It might help the labor market, our civic society, our culture.” But Americans should be more clear, he says, about why they are investing in school improvement. His research suggests that doing so in order to boost a child’s chances to outearn their parents is unlikely to be successful. According to Rothstein, education systems just don’t go very far in explaining the differences between high- and low-opportunity areas.
As a stronger explanation, Steinbaum points to the rise of “interfirm inequality,”a phenomenon in which even workers with very similar education histories, ages, and industries make very different amounts of money depending on which firms they work for.
Meanwhile, other studies have suggested that differences in local labor markets can affect economic outcomes and upward mobility. For example, in 2015, the left-leaning Center for American Progress, in conjunction with the economists Richard Freeman and Eunice Han, published a report building on Chetty’s work and found that union membership seems to be another critical factor helping poor people escape poverty. The researchers went beyond Chetty’s regional-level analysis to compare outcomes between individual union and nonunion households. They found that low-income children who grew up with parents in unions earned more as adults than the children of nonunion parents. They concluded that making it easier for individuals to collectively bargain would likely help boost economic mobility.
Marie Connolly, an economist at the University of Quebec in Montreal who collaborates with Corak, told me that after studying geographic mobility across Canada, her team has identified similar patterns as Rothstein did in the United States.
“Education is just not a big part of the story,” she says. “You can see a little role for school quality, but the structure of the labor market seems to be a much bigger driver.”
Rothstein’s research is certainly not the final word on the subject, and his study comes with some caveats. The first, as mentioned earlier, is that his findings are not causal. It could be, for example, that whatever is going on in places where children are more likely to rise up the economic ladder, like Salt Lake City and San Jose, have low-income families that have some other unidentified characteristic—such as different parenting styles—that affects their children’s lives. It’s possible these families produce economically successful children for reasons that have nothing to do with where they live.
Another caveat, related specifically to Rothstein’s school-quality finding, is that low-income children who grow up in places that see lots of children transcend poverty could have some unobservable characteristic that leads them to have good employment outcomes but poor academic performance. And Rothstein does not identify specific schools in his paper when drawing his school-quality conclusions, meaning he’s making indirect inferences.
Ultimately, most Americans would probably agree that leaders should work to build great schools, and that individuals who work hard should be able to improve their economic earnings over time. Devoting the bulk of one’s attention to the former in the hopes that it causes the latter, however, might prove to be a real mistake.