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  3. American Economic Review
  4. November 2023
  5. Measuring Upward Mobility

Measuring Upward Mobility

  • Debraj Ray ⓡ
  • Garance Genicot
American Economic Review
vol. 113, no. 11, November 2023
(pp. 3044-89)
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Abstract

We conceptualize and measure upward mobility over income or wealth. At the core of our exercise is the Growth Progressivity Axiom: transfers of instantaneous growth rates from relatively rich to poor individuals increases upward mobility. This axiom, along with mild auxiliary restrictions, identifies an "upward mobility kernel" with a single free parameter, in which mobility is linear in individual growth rates, with geometrically declining weights on baseline incomes. We extend this kernel to trajectories over intervals. The analysis delivers an upward mobility index that does not rely on panel data. That significantly expands our analytical scope to data-poor settings.

Citation

Ray, Debraj ⓡ Garance Genicot. 2023. "Measuring Upward Mobility." American Economic Review, 113 (11): 3044-89. DOI: 10.1257/aer.20220316

Additional Materials

JEL Classification

  • D31 Personal Income, Wealth, and Their Distributions
  • D63 Equity, Justice, Inequality, and Other Normative Criteria and Measurement
  • I32 Measurement and Analysis of Poverty
  • O15 Economic Development: Human Resources; Human Development; Income Distribution; Migration
  • O40 Economic Growth and Aggregate Productivity: General