Upheaval: Turning Points for Nations in Crisis

by Jared Diamond

Closely related to this issue of economic inequality that I’ve just been discussing is the issue of socio-economic mobility: i.e., the likelihood that individual Americans can overcome economic inequality, and that poor Americans can become rich. Americans, more than citizens of other countries, believe that their country is a meritocracy, in which people achieve the rewards that their individual abilities permit them to achieve. This is symbolized by the distinctively American phrase “rags to riches”: we believe that a poor immigrant who arrives in rags can become rich through ability and hard work. Is this central belief of ours true? One method by which social scientists have tested this belief is to compare, among different countries, the correlation coefficients between incomes (or income ranks within people of their generation) of adults and the incomes of their parents. A correlation coefficient of 1.0 would mean that relative incomes of parents and of their adult children are perfectly correlated: all high-income people are children of high-income parents, all low-income people are children of low-income parents, kids from low-income families have zero chance of achieving high incomes, and socio-economic mobility is zero. At the opposite extreme, if the correlation coefficient were zero, it would mean that children of low-income parents have as good a chance of achieving high incomes as do children of high-income parents, and socio-economic mobility is high. The co...