Higher Education and

Intergenerational Income Persistence

in the United States

Deirdre BloomeUniversity of Michigan

May 3, 2019

Education perpetuates inequality

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70

Educational Stratification

Parents' Income Quartile

Q1 Q2 Q3 Q4

(% of Children with BA+)

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Educational Returns

Adult Educational Attainment

<HS HS Some Coll. AA BA+

(Mean Income Rank, Relative to <HS)

Education increasingly perpetuates inequality

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Rising Educational Stratification

Parents' Income Quartile

Q1 Q2 Q3 Q4

(% of Children with BA+)

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100

150

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350

Rising Educational Returns

Adult Educational Attainment

<HS HS Some Coll. AA BA+

(Mean Income Rank, Relative to <HS)

. . . Yet intergenerational persistence has remained stable

1985 1990 1995 2000 2005 2010 2015

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100

150

Year Aged 30

(Change in Intergenerational Income Persistence)

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Education perpetuatesinequality

Education disruptsinequality

AND

An equalizing educational trend

HS or Less Some Coll. AA BA+

College Degrees Became More Common...

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70(% of Children by Education)

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0.15

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0.25

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0.35

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0.45

...and Persistence Declines with Education

HS or Less Some Coll. AA BA+

(Intergenerational Income Persistence by Education)

A puzzle

Has intergenerational income persistence remained stable in theUnited States because disequalizing educational trends have beencounterbalanced by equalizing educational trends?

Answer: No.

→ Educational trends have been more disequalizing than→ equalizing.

→ Other changes combined with educational expansion to→ counterbalance rising educational inequalities→ (changes in young adult life course, rising economic→ insecurity)

A puzzle

Has intergenerational income persistence remained stable in theUnited States because disequalizing educational trends have beencounterbalanced by equalizing educational trends?

Answer: No.

→ Educational trends have been more disequalizing than→ equalizing.

→ Other changes combined with educational expansion to→ counterbalance rising educational inequalities→ (changes in young adult life course, rising economic→ insecurity)

In the remaining time

I Details

I Implications

Data

Two cohorts from the National Longitudinal Surveys of Youth

I 1979 cohortI Survey years 1979-2014I Born in early 1960, college-age in early 1980s, age 30 in 1990s

I 1997 cohortI Survey years 1997-2015I Born in early 1980s, college-age in early 2000s, age 30 in 2010s

Measuring intergenerational income persistence

All

Parental Income

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20

40

60

80

100

Rank Slope

Measuring intergenerational income persistence

All All

Parental Income

0

20

40

60

80

100

Rank Slope

% Upwardly Mobile

Measuring intergenerational income persistence

All All Q1 Q2 Q3 Q4

Parental Income

0

20

40

60

80

100

Rank Slope

% Upwardly Mobile

% Upwardly Mobile by Parental Income

Measuring intergenerational income persistence

All All Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

Parental Income

0

20

40

60

80

100

Rank Slope

% Upwardly Mobile

% Upwardly Mobile by Parental Income

% Remain in Quartile by Parental Income

Trends in intergenerational income persistence

All All Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

Parental Income

0

20

40

60

80

1001979 cohort1997 cohort

Rank Slope

% Upwardly Mobile

% Upwardly Mobile by Parental Income

% Remain in Quartile by Parental Income

Education’s multiple roles in persistence trends

1. Perpetuating inequality via educationI Rising inequality between levels of

education in parental incomeI . . . and in adult income → higher

persistence

2. Disrupting inequality via educationI Educational expansion across the

income distributionI More college graduates → lower

persistence

3. Changing persistence withineducation groups

I Changes in the life courseI Changes in the labor market

Key takeaways

1. Scholars have been puzzled by the lack of change inintergenerational income persistence over a period of risingeducational inequalities

. . . We show that persistence was stabilized by offsetting

. . . trends

2. Educational expansion disrupted persistence (the“meritocratic power” of a college degree)

. . . yet dramatic as this expansion was, it did little to offset

. . . the effect of rising educational inequality by

. . . parental income

3. To understand changes in persistence, we must considerchanges in the (young) adult life course

. . . not only changes in childhood circumstances

Implications

I Educational policy

I Beyond education

Educational policy

For intergenerational persistence, equalization of educationalopportunities = more important than college expansion

I Who goes to college, rather than how many

I Class-conscious effortsrequired—in each stepof the educationalpipeline

I Adding more seatswould help, butwouldn’t be enough

Beyond education

I Education-linked inequalitiescan outlast educational reform

I advanced degrees =increasingly important axis ofstratification

I educational returns dependon labor market structures

I Many inequalities are noteducation-linked

I declining persistence withineducation groups:→ insecurity or

opportunity?I fractal inequality at the top:

→ dream hoarders vs.occupy wall street

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0.45

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HS Some Coll. AA BA MA+

(Intergenerational Income Persistence by Education)

Higher Education and

Intergenerational Income Persistence

in the United States

Deirdre BloomeUniversity of Michigan

dbloome@umich.edu