The economist Raj Chetty has spent much of the last decade trying to answer a very big question: What happened to the American Dream? In 1940, a child born into the average American household had a 92 percent chance of making more money than his or her parents. But in the last half century, something has gone wrong. A child born in 1980 had just a 50 percent chance of surpassing her parents’ income. So, in 40 years, earning more than your parents went from being a near certainty to no better than a coin flip.
Marshaling enormous data sets in extremely creative ways, Chetty has shown that our chances of moving up in the world are exquisitely sensitive to where we grow up. In some cities, like Minneapolis, the American Dream seems to be very much alive. In other places, the poor are trapped in poverty for generations. So, the trillion-dollar question here is: If some neighborhoods in America are like Miracle-Gro for opportunity, what are the active ingredients? What makes a place special? In today's episode, Chetty gives listeners a new vocabulary to think about success and inequality in America, with ideas like "father presence," "friending bias," and "Lost Einsteins." If you’d like to see a literal map of American inequality built with Chetty’s data, I would encourage you for this episode alone to go multi-media and visit www.socialcapital.org to see how your neighborhood fares as an engine of upward mobility. That way, you’ll have a fuller sense of where the American Dream is dying—and what we have to do to bring it back.
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Host: Derek Thompson
Guest: Raj Chetty
Producer: Devon Manze
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