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Education and mobility: - PPT Presentation

GatSby in the Americas Darryl McLeod Fordham University Economics Center for International Policy Studies Presentation at CCNYLALS Latin American and Latino Studies Monday November 19 ID: 788613

inequality mobility education 2018inequality mobility inequality 2018inequality education latin america immigration 2014 social college 2018 amp 2010 chetty 2013

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Slide1

Education and mobility: GatSby in the Americas

Darryl McLeod Fordham University Economics Center for International Policy StudiesPresentation at CCNY-LALS Latin American and Latino StudiesMonday November 19th

11/19/2018

1

Slide2

The U.S. and Latin America in a great race between technology and education

11/19/2018Inequality and Mobility 2

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11/19/20183From 2000 to 2015 Inequality fell in Latin America and mobility increased, for the first time ever children surpassed their parents in education…especially women

Why & how? Transfer programs conditional on school attendance (CCTs) target excluded groups…

Slide4

11/19/20184Starting in 1997 Mexico Progresa-Oportunidades-Prospera spreads to Brazil, Colombia, Chile, Argentina targets women with children

Slide5

Mothers and children in Hildago Mexico The Prospera (previously Oportunidades) is a conditional cash transfer program benefits nearly six million families about ¼ of Mexico’s population.

Launched 1997 after a financial crisis, it has been replicated in 52 countries including most large Latin American countries (as in Bolsa Familia)See 2014 interview of Francesca Lamanna, social protection specialist at the World Bank, 11/19/20185

Slide6

Why is inequality rising in the U.S.? answer “the new geography of Jobs” e.g. Amazon 2 in Queens UCB’s Enrico Moretti points out rising inequality between cities with college educated

Relevant to the NYC and the Bronz right now: Amazon HQ coming to Queens… Here are his slides (right click to open in a new tab)11/19/2018Inequality and Mobility 6

Slide7

Why is inequality high & rising in the U.S. and in NYC? Answer: “the new geography of Jobs” e.g. Amazon 2 in Queens

UCB’s Enrico Moretti points out rising inequality between cities with college educated Who benefits when college educated pop increases?NYC and the Bronx right now: Amazon HQ 2 coming… Enrico’s slides (right click to open in a new tab)Furman Center on Gentrification? Who has to move?See also DSI report on Washington HeightsWhere has crime fallen dramatically in New York City?A tale of two blackouts, 1977 and 2003?

11/19/2018

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Who can stop rising high & rising in the U.S. and in NYC? Answer: our Mayor and Governor or…

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Inequality is falling in Latin America, but rising int the U.S…can this be fixed by free education? In the USA, growth slowed and access to education reproduced inequality… top 1% courted by best schools (not the most meritorious)

Inequality and expensive selective schools reduced mobility and reinforced inequality… In Latin America, expansion of education through social transfer programs and faster growth 2000 to 2015 led to falling inequality and rising mobility 11/19/2018Inequality and Mobility 9

Slide10

Inequality is falling in Latin America, but rising in the Bronx and the U.S…free education? Alexandria Ocasio Cortez or Mayor Bloomberg (New America) In the USA, growth slowed and access to education reproduced inequality… top 1% courted by best schools (not the most meritorious)

Inequality and expensive selective schools reduced mobility and reinforced inequality… In Latin America, expansion of education through social transfer programs and faster growth 2000 to 2015 led to falling inequality and rising mobility 11/19/2018Inequality and Mobility 10

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Chile mobility increases: share of education not explained by parent’s SES 11/19/2018Inequality and Mobility 11

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Chile inequality is falling… 11/19/2018Inequality and Mobility

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Three women Presidents 2013(but alas…)11/19/2018

Inequality and Mobility 13

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Chilean students creatively “protest” high cost of college and student debt… why?11/19/2018Inequality and Mobility 14

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Answer: student loans lower income students into college and middle class or higher: example Camila Vallejo Dowling Chilean student leader now congress-woman under President Michelle Bachelet: 11/19/2018

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Education: gender convergence opens new gender gap… starting with 1968 cohort, Latin women become more educate than men (Nopo, 2012)Changes from 1990 to 2010

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Globalization and new technologies means more education needed to climb to top… 11/19/2018Inequality and Mobility 17

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Education raises social mobility if children more educated than their parents: 3 related Mobility measures Intergenerational Education Mobility:

Gatsby curve for Chile & Latin America Absolute Mobility: how far NYC residents climb compared to parents? College mobility: access vs. success for 30 million students: Chetty et al 2017 “solving social problems with big data…”11/19/2018Inequality and Mobility 22

Slide23

Intergenerational Education MobilityEducational IGM: do you have more education than your parents? …. across generations.

If your education matches that of your parent’s: Low IGM family status and SES determine your future.Mobility is a break with the past, your generation is better educated than you parents… The more correlated with your schooling is with your parents the less social mobility there is… you need connections to get into a good schoolIGM Mobility can be negative….see Venezuela for example 11/19/2018Inequality and Mobility 23

Slide24

Alan Krueger’s forecast 11/19/2018Gende and inequality

24Intergenerational elasticity of income

Slide25

11/19/2018Inequality and Mobility 25

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Convergence: “todos somos Americanos”… 11/19/2018

Inequality and Mobility

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Did education reduce inequality in LatAm? 11/19/2018Inequality and Mobility 27

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LatAm Middle Class emerging….

Slide29

Figure 12. Change in the Gini index, selected Latin American countries, 2000-2010.Source: Figure 1.3 from Ferreira et al (2010), modified by Ferreira (2012). Data source: World bank 201111/19/2018

Inequality and Mobility 29

Slide30

Mobility across U.S. cities and regions Chetty et al. find lots of variation with lower mobility in the South

Immigration and Inequality

30

5/19/2014

http://www.equality-of-opportunity.org/

Slide31

Gatsby curve NYC has highest inequality, but mobility in top 1/4 of U.S. cities: 1980-82 kids in 25th get to 44th in 2010-12 11/19/2018

Inequality and Mobility

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Slide32

Measure 2: Absolute Mobility across major Cities-urban labor markets Absolute Mobility: Where you end up in the income distribution compared to your parents:

Example Chetty et al. 2014: New Yorkers whose families start at the 25th percentile end up at the 44 percentile on averageNew York has top 20 mobility but the highest inequality of any city… a number rich cities have this characteristic. Chetty et. al 2014 matches 18 million tax returns, 1980 more or less to about 2010… big data from the IRS… 11/19/2018Inequality and Mobility 32

Slide33

Immigration associated w/ higher inequality

33

59/2014

Slide34

Gatsby curve for major cities in U.S. NYC an

exception: Highest inequality, but mobility in top 1/4 of U.S. cities: 1980-82 kids in 25th get to 44th in 2010-12

Immigration and Inequality

34

5/9/2014

Slide35

Immigration associated

with higher mobility

Immigration and Inequality

35

5/9/2014

Slide36

11/19/2018

Inequality and Mobility

36

Immigration

is

associated

with

higher

mobility

Slide37

U.S. FB share rose from 4.7 in 1970 to 13 in 2012, a rise of over about 8 percentage points 5/9/2014Out of the Shadows: Empowering NYC Mexicans37

Slide38

Immigration and inequality short not long term depends on education and innovation…

Immigration and Inequality

38

5/19/2014

Immigration increases inequality in ST

Chetty

cities data shows as FB share 4.7% to 13%+ from 1970 to 2010 can explain rise in

Gini

from 40 to 44 (have the distance to 48)

Inequality increases ST

as immigrants compete: Hispanic but not native wages fall with immigration & integration.

Immigration increases mobility

in the Americas as children stimulate growth and invest in schooling wages rise for immigrants and natives over the over longer term (CBO, 2013).

Financial inclusion & immigration

reform raises growth and asset accumulation by Hispanics, reducing share of inherited wealth, see

Piketty

, 2014, p. 83-84.

**U.S. Congressional budget Office (2013) The Economic Impact of S. 744, the Border Security, Economic Opportunity, and Immigration Modernization Act

Slide39

Mobility varies across the USSource: Chetty et al. 2014 http://www.equality-of-opportunity.org/11/19/2018

Inequality and Mobility

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Slide40

Immigration and Inequality

40

5/9/2014

Slide41

Measure 3 college mobility as defined by Chetty et al. 2017 matters… They match 30 million IRS returns to children’s education

A college education raises social mobility if parents have less education (immigrants?) A college education also reduces inequality if the share of well educated increases into to a larger middle class…They find colleges level the playing field for any starting point. Current admissions and fees exacerbate rather than attenuate inequality, except in a few schools 11/19/2018Inequality and Mobility

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Measure 3: college mobility leads higher and more equal incomes for low income entrants

11/19/2018Inequality and Mobility 42

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Measure 3: college mobility leads higher and more equal incomes for low income entrants

11/19/2018Inequality and Mobility 43

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Mobility is share from low group (access) times the share that make it (61% x 63% = 38%11/19/2018Inequality and Mobility 44

Slide45

Chetty et al. 2017 publish several mobility measures… see the NY Times for more11/19/2018Inequality and Mobility

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Chetty et al. 2017 publishes some college measures… see the NY Times for morehttps://www.nytimes.com/interactive/projects/college-mobility/city-college-of-new-york11/19/2018Inequality and Mobility

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11/19/2018Inequality and Mobility 47

Slide48

This is a NY Times interactive graphic “selective public schools” light up… 11/19/2018Inequality and Mobility

48

Slide49

What about Fordham?11/19/2018Inequality and Mobility 49

Slide50

Mobility report cards online at NY Times http://www.equality-of-opportunity.org/documents/https://www.nytimes.com/interactive/projects/college-mobility/city-college-of-new-york11/19/2018Inequality and Mobility

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This is a NY Times interactive graphic11/19/2018Inequality and Mobility

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11/19/2018

Inequality and Mobility 56Share from low income families going down: not good

Slide57

Education increases inequality if … 11/19/2018

Inequality and Mobility 57

Slide58

Immigration, growth and inequality short term long term

Immigration and Inequality

58

5/19/2014

Immigration increases inequality in ST

Chetty cities data shows as FB share 4.7% to 13%+ from 1970 to 2010 can explain rise in Gini from 40 to 44 (have the distance to 48)

Inequality increases ST

as immigrants compete: Hispanic but not native wages fall with immigration & integration.

Immigration increases mobility

vs.

LatAm

and within the U.S. children of immigrants consistently outperform natives in school this increases Hispanic wages over longer term (CBO, 2013).

Financial inclusion & immigration

reform raises growth and asset accumulation by Hispanics, reducing share of inherited wealth, see

Piketty

, 2014, p. 83-84.

**U.S. Congressional budget Office (2013) The Economic Impact of S. 744, the Border Security, Economic Opportunity, and Immigration Modernization Act

Slide59

Gender and Mobility…in Latin AmericaSince 1970 female education increased faster than male but return to education (Mincer coefficient) fell less for women…

Female labor force participation increasing in Latin America where FHH increasing, but no reduction in social mobility: migration, employment opportunities. . In the United States, assortative mating has increased inequality, in Latin American education correlation for couples falling in most countries, reducing inequality… Redistributive social programs target women and children conditional on education… 11/19/2018Inequality and Mobility

59

Slide60

11/19/2018Inequality and Mobility 60

Slide61

Family structure and mobility in the U.S.

Immigration and Inequality

61

5/9/2014

Slide62

Family structure and mobility in Latin America

Immigration and Inequality

62

5/9/2014

Slide63

Why the Gatsby curve is working in Latin America and in the United States: Rising inequality in the U.S. is at the very top 1% and 10% al la Piketty, but this does not effect mobilityLatAm

has a rising middle class, improved education (starting from a low base)Class, race & family structure create obstacles to mobility in the U.S. despite some progress in access to education… CCTs and education policy working in LatAm but less in the United States (preschool etc.)11/19/2018

Inequality and Mobility

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Slide64

The Gatsby Curve works across Latin America Countries and over timeConvergence: inequality high in LatAm mobility low relative to U.S. now convergingSocial policy: LatAm greater commitment to equity that the USA (since 2000 at least)

Gender: large gains in education made by women, rise in Female headed households increased mobility New data available11/19/2018

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ReferencesAndersen L., 2001,"Social Mobility in Latin America: Links with Adolescent Schooling", IDB Working Paper No. 146, Washington DC.

Angulo R., Azevedo J.P., Gaviria A. and Páez G., 2012, "Movilidad social en Colombia" [Social Mobility in Colombia], Center for Economic Development Studies, Universidad de los Andes [University of the Andes], working paper no. 43.Azevedo, V. and Bouillon C., 2010, "Intergenerational Social Mobility in Latin America: A Review of Existing Evidence.",

Revista de

Analisis

Economico

, 25, 7-42.

Birdsall

, N.,

Lustig

, N., & McLeod, D. (2011).

Declining inequality in Latin America: some economics

. Some Politics, Centre for Global Development Working Paper, 251.

Clemens, 20132 https://www.cgdev.org/blog/haitian-officials-welcome-h-2-visa-program-%E2%80%93-michael-clemens

CEDLAS and The World Bank, 2012, "A Guide to the SEDLAC Socio-Economic Database for Latin America and the Caribbean", (March 2012 version)

Raj

Chetty

& Nathaniel

Hendren

& Patrick Kline & Emmanuel

Saez

& Nicholas Turner, (2014) "Is the United States Still a Land of Opportunity? Recent Trends in Intergenerational Mobility," American Economic Review, vol. 104(5), pages 141-47,

Chetty

, Raj, Nathaniel

Hendren

, Patrick Kline, and Emmanuel

Saez

(2014), “Where is the Land of Opportunity? The Geography of Intergenerational Mobility in the US”, NBER Working Paper 19843

Conconi

A., Cruces G.,

Oliveri

S.,

Sanchéz

R., 2008, "E

pur

si

move

? Movilidad, pobreza y desigualdad en

América

Latina.",

Económica

,

La Plata, Vol. LIV, Nro. 1-2.

Corak

, M., 2006, “Do Poor Children Become Poor Adults? Lessons for Public Policy from a Cross-Country Comparison of Generational Earnings Mobility.” Research on Economic Inequality, Vol. 13: Dynamics of Inequality and Poverty,

ed

Creedy

Guyonne

Kalb, 143–88. Netherlands: Elsevier Press.

Corak

, Miles. "Income inequality, equality of opportunity, and intergenerational mobility." 

The

Journal of Economic Perspectives

 

(2013): 7-102

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ReferencesGasparini, L., Galiani

, S., Cruces, G., Acosta, P. , 2011, "Educational upgrading and returns to skills in Latin America. Evidence from a supply-demand framework, 1990-2010.", World Bank Policy Research WP 5921Krueger, Alan (2013) Land of Hope and Dreams: Rock and Roll, Economics, and Rebuilding the Middle Class address to the Rock and Roll hall of Fame, Cleveland Ohio, June 12th Lopez-

Calva, L. F.,

Lustig

, N., Scott, J., Castaneda, A. ,2012, "Cash transfers and public spending on education and health in Mexico 1992-2010: Impact on inequality and poverty." Mimeo, The World Bank.

Lopez-

Calva

, N.

Lustig

, 2010, "Declining inequality in Latin America: A decade of progress?", Brookings Institution and UNDP, Washington DC.

Lustig

N, Lopez-

Calva

L.F., Ortiz-Juarez E., 2011. "The decline in inequality in Latin

Amer

-

ica

: How much, since when and why," Working Papers 211, ECINEQ, Society for the Study of Economic Inequality.

Lustig

N, Lopez-

Calva

L.F., Ortiz-Juarez E., 2013, "Deconstructing the Decline in Inequality in Latin America"., Tulane Economics Working Paper No 1314

Hertz T.,

Jayasundera

T.,

Piraino

P.,

Selcuk

S., Smith N., and

Verashchagina

A., 2007, "The In- heritance of Educational Inequality: International Comparisons and Fifty-Year Trends," The B.E. Journal of Economic Analysis & Policy 7, Article 10.

Ñopo

, H., 2012, "New Century, Old Disparities: Gender and Ethnic Earnings Gaps in Latin America and the Caribbean.", Washington, DC: Inter-American Development Bank and the World Bank., l’ Inter-American Development Bank. https://

openknowledge.worldbank.org

/handle/10986/11953

Tienda

, M., and Fuentes, N. , 2014, "Hispanics in Metropolitan America: New Realities and Old Debates.", Annual Review of Sociology, 40, 499-520.

Torche

,

Florencia

. , 2015, "Analyses of Intergenerational Mobility An

Interdisciplinary Re- view.", The ANNALS of the American Academy of Political and Social Science 657.1, 37-62.

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ReferencesCorak, M., 2012, "How to Slide Down the “Great Gatsby Curve: Inequality, Life Chances, and Public Policy in the United States." Center for American Progress, December.Corak, Miles. 2013. "Income Inequality, Equality of Opportunity, and Intergenerational Mobility.", Journal of Economic Perspectives, 27(3): 79-102.Cornia

, A., 2013, "Inequality Trends and their Determinants: Latin America over 1990 - 2010.", in Cornia, A. (Ed.), Falling Inequality in Latin America: Policy Changes and Lessons, Oxford University Press.Cuesta, J., Ñopo H. and Pizzolitto G. (2011), "Using Pseudo-Panels to Measure Income Mo- bility in Latin America.”, Review of Income and Wealth, 57: 224-246.Daude, C., 2011, "Ascendance by Descendants?: On Intergenerational Education Mobility in Latin America.", OECD Working Papers No. 297, OECD Publishing.Daude, C., 2012, "Education, middle classes and social mobility in Latin America," Pensamiento Iberoamericano No. 10 (in Spanish), pp. 29-48, 2012 Background WPDaude, C., 2013, "Education and social mobility in Latin America," LASA Forum, 44 (2), pp. 7-9, Spring 2013Galiani S., 2013, "Social Mobility: What is it and Why Does it Matter?".

Económica, Vol. LIX: 167-229.

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