social capital and economic mobility

My colleagues and I have a stream of work that argues that civic engagement is valuable economically–it helps the individuals who engage and their whole communities. I would never argue that civic engagement is the only thing that matters; an economy can be crushed by external, macro-level changes, such as the demise of an industry or a bad policy. But how we associate is an important factor.

A strong contribution to this literature is by Raj Chetty, Nathaniel Hendren, Patrick Kline, and Emmanuel Saez, “Where is the Land of Opportunity? The Geography of Intergenerational Mobility in the United States,” NBER Working Paper No. 19843 (January 2014). The authors examine the tax records of 40 million parents and then their children as adults. They find that where you grow up has a major effect on your mobility–on whether you move up the income distribution compared to your parents when you were a child. The raw differences between a childhood in San Jose and in Charlotte, for example, are striking.

The next question is what about these communities matters. In a model that also includes many other plausible factors, the authors find the largest effects from racial segregation (not being African American, but living in a community that is predominantly African American is bad for mobility); inequality (being a child in a more equal community boosts mobility); the quality of primary schools; social capital (“proxies for the strength of social networks and community involvement in an area”); and family stability.

The authors find that these factors are statistically independent, but I would argue they are conceptually related and tell a coherent overall story. For example, segregation is a different empirical construct from social capital–you can have a community rich in associations even though it is racially segregated. And Chetty et al find that both factors matter independently for mobility. Yet the fact that they both count seems to suggest a broader story: we are better when connected. Likewise, school quality is a different matter from family stability, and yet both may reflect a greater capacity to provide structure and care for our children. And certainly, social capital is good for school quality.

[Some cautions here about using empirical evidence to make a case for something that you would value anyway, such as civic engagement.]

About Peter

Associate Dean for Research and the Lincoln Filene Professor of Citizenship and Public Affairs at Tufts University's Tisch College of Civic Life. Concerned about civic education, civic engagement, and democratic reform in the United States and elsewhere.
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