Social Mobility and Horizontal Inequality: A Model, with Illustrations (Pre-Recorded)

• In Event: Political Inequality: Causes and Effects

Abstract

Research on social mobility has paid considerable attention to its links with inequality. Looking across countries, empirical data suggest a clear relationship between inequality and intergenerational mobility, coined the ‘Great Gatsby Curve’, which has motivated considerable study in economics of casual linkages (Corak, 2013). The vast majority of this work has focused on vertical inequality between individuals or households. This paper considers instead horizontal inequality between groups in society, specifically those defined in ‘ethnic’ or ‘cultural’ terms.

Research shows clearly that horizontal inequalities vary over time and space, but considerable work remains to be done in terms of understanding horizontal inequality as an outcome (Canelas & Gisselquist, 2018; Stewart & Langer, 2008) This paper presents and probes the empirical predictions of a new framework for understanding the factors that influence contemporary persistence and change in horizontal inequalities of various types. The simple model, which builds from Chetty, Hendren, Jones, and Porter (2018), hinges on the relationship between horizontal inequality and intergenerational economic mobility, in so doing drawing new linkages across literatures on social mobility, horizontal inequality, and ethnic politics.

The model offers two core interrelated predictions: (a) Horizontal inequality can be expected to be persistent over decades and multiple generations in situations where starting levels of horizontal inequality are high and overall intergenerational mobility low, and (b) horizontal inequality can be expected to persist even longer, sometimes indefinitely, in situations where mobility varies across ethnic groups and is lower for disadvantaged as compared to advantaged ethnic groups. Available empirical data suggest that it is not unusual to find such variation in social mobility across ethnic groups, and further that low rates of social mobility comparatively affect some countries more than others, and in particular in low income as compared to high income countries. A key implication that can be drawn from the model is that horizontal inequality will be incredibly persistent in many contexts, especially in developing countries, absent activist intervention to promote horizontal inequality, such as affirmative action programs.

The paper probes the plausibility and implications of the model drawing on empirical evidence from selected countries, including South Africa, India, and the United States.

Authors

• Rachel M. Gisselquist, United Nations University

• Patricia Funjika, University of Zambia