Economic Mobility Study Raises Distressing Questions about Child Welfare

By Andrea Flores

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While the release of a landmark study on income mobility earlier this year set the news media abuzz with stories about inequality, there was scant mention of children involved with the child welfare system, for whom moving up the economic ladder is uniquely challenging.

The study, entitled “The Equality of Opportunity Project” was conducted by economists at the University of California Berkeley and Harvard University and measured income mobility in the United States.

By looking at tax records of more than 40 million people spanning the years of 1971 to 1993, the researchers were able to measure the chances that a child born in the bottom fifth of the income distribution would move into the top fifth.

While economic mobility rates are about the same as a generation ago, the disparity in income levels has shot up wildly.

This makes which income you are born into more important than ever before. The study uses the helpful analogy of a ladder in explaining the significance of greater disparity in income. If you think of a ladder the odds of climbing it are the same except many more rungs have been added in between the top and bottom.

The study also drew a picture of the predictors of economic immobility, including lack of family stability and living in communities with low performing schools. The former is definitionally prevalent among foster youth; the latter is also disproportionately true for children involved with the child welfare system. Despite this, it remains unclear how questions of economic disadvantage among this population will affect public policy.

“Children in the foster system often have low socioeconomic status,” said Hilary Hoynes a professor of public policy and economics who hold the Haas Distinguished Chair in Economic Disparities at the University of California, Berkeley’s Goldman School of Public Policy. “This research describes how inheriting low socioecononomic status influences life courses. Therefore because being in foster care often means low socioeconomic status the study is relevant. “

The study also suggests that there is an important correlation between family stability and the ability to move to a higher income level. The strongest predictor of a child’s economic mobility is family structure. Belonging to a community with high family stability is the single greatest predictor of income mobility. In other words, a child surrounded by stable families is more likely to earn a higher income than their parents.

This correlation has important inferences for children in the foster system. Households with foster children are typically less likely to be married-couple households and more likely to be single parent or cohabiting-couple households.

The Equality of Opportunity Project found that when it comes to family structure, areas with a higher fraction of children living in single-parent households have the lowest income mobility.

In addition, the quality of schools in the community is also a predictor of income mobility.

Controlling for income levels, the study found that children in communities where schools have higher test scores and low drop out rates also have a better chance of climbing the income ladder.

California foster youth are more likely than the general population youth to attend schools with low performance ranks. In 2013 researchers from the Institute for Evidence Based Change and the University of California Berkeley’s Center for Social Services Research confirmed the disproportion in the report entitled “At Greater Risk.” In California, about one-half of foster youth attended schools in the bottom 30 percent when measuring school performance compared to two-fifths of youth not in the foster system who attended these schools.

The study also suggests that improving predictors such as family stability and quality of education would benefit communities as a whole. One example is that children of married parents have higher rates of upward mobility if they live in communities with fewer single parents. Community well-being is just as important as individual well-being.

While many are happy to speculate on the public policy implications of this new research, those that conducted it are more reserved.

“At this point the connection to public policy is unclear,” said Patrick Kline, one of the Equality of Opportunity Project researchers. “We are looking for people to use this information to do the policy work”.

Andrea Flores is a student of legal studies at the University of California, Berkeley. She wrote this story while taking the Journalism for Social Change class. 

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