Rags ro riches myth

While a relative few individuals do make it from “rags to riches” without being born rich, the statistical reality is quite different. Intergenerational” earnings mobility is a measure of the likelihood that a generation will earn more in real terms than earlier generations within the same family. On this, the United States actually scores third-lowest among the OECD countries. Even worse, the level of inequality in the working-age population is the highest.

The latest assessment of the national mobility (for 16 of the OECD economies) was conducted a decade ago, in 2008. All the available evidence underscores that the results have only become more pronounced since then. Moreover, any changes are relatively slow to take effect.

This low ranking for the United States means not just that there is a great gap between rich and poor, but also that the children of rich people remain rich – and often becoming even richer. And U.S. children not born wealthy are relatively unlikely to move up in income status after they enter the workforce.