Intragenerational mobility

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What Is Intragenerational Mobility?

Intragenerational mobility refers to the movement of an individual within the socioeconomic hierarchy over the course of their lifetime. This concept is a fundamental aspect of socioeconomics, a broader financial category that examines the intersection of economic activity and social life. It measures changes in an individual's financial standing, occupation, or social class from their entry into the workforce to their retirement. Understanding intragenerational mobility provides insights into the dynamics of opportunity, income inequality, and the effectiveness of various public policy initiatives in a society. Unlike intergenerational mobility, which compares the socioeconomic status of parents and their children, intragenerational mobility focuses solely on an individual's personal trajectory.

History and Origin

The study of social mobility, including intragenerational mobility, has roots in early sociological and economic thought. As societies industrialized and social structures became more fluid, scholars began to analyze how individuals moved within the social hierarchy. Early work in the 20th century, particularly in Europe and the United States, laid the groundwork for systematic empirical studies of social and economic standing.

The concept gained prominence with the rise of empirical sociology and economics, which sought to quantify social change. The focus on individual life courses became more pronounced as longitudinal data became available, allowing researchers to track individuals' career paths and financial progression. Organizations like the Organisation for Economic Co-operation and Development (OECD) now actively study and report on social mobility to inform policy decisions aimed at fostering greater equality of opportunity. The OECD, for instance, has established an Observatory on Social Mobility and Equal Opportunity to advance data collection and discuss policies to break down barriers to equal opportunity¹⁰.

Key Takeaways

• Intragenerational mobility tracks an individual's socioeconomic changes throughout their adult life.
• It encompasses shifts in income, occupation, and social standing.
• The concept is crucial for assessing economic opportunity and social fairness within a single generation.
• Factors such as education, job changes, and investment decisions significantly influence intragenerational mobility.
• Analyzing intragenerational mobility helps policymakers evaluate the impact of economic and social programs.

Formula and Calculation

Intragenerational mobility is not typically represented by a single, universally accepted mathematical formula. Instead, it is assessed through various metrics that quantify changes in an individual's socioeconomic status over time. Researchers use different proxies for socioeconomic status, such as:

• Income Change: The difference in an individual's income at two different points in their career. $$\text{Income Mobility} = \text{Income}_{\text{later age}} - \text{Income}_{\text{earlier age}}$$
• Occupational Prestige Score Change: Assigning scores to occupations based on their perceived prestige or skill level and measuring the change over time. $$\text{Occupational Mobility} = \text{Occupational Score}_{\text{later career}} - \text{Occupational Score}_{\text{early career}}$$
• Wealth Change: The difference in an individual's net worth at various stages of their life, reflecting changes in wealth accumulation. $$\text{Wealth Mobility} = \text{Net Worth}_{\text{later life}} - \text{Net Worth}_{\text{early life}}$$

These measures can be analyzed in absolute terms (e.g., how much income increased) or relative terms (e.g., how an individual's rank in the income distribution changed).

Interpreting Intragenerational Mobility

Interpreting intragenerational mobility involves understanding the forces that enable or constrain an individual's economic and social progression over their lifetime. A high degree of upward intragenerational mobility indicates a dynamic economy where individuals have ample opportunities to improve their circumstances through factors like educational attainment, skill development, and career advancement. Conversely, low intragenerational mobility might suggest structural barriers, limited economic opportunities, or significant income inequality that prevent individuals from moving up the ladder.

For example, an individual who starts their career in an entry-level position and, through promotions and increased earnings, eventually reaches a senior management role with a substantially higher standard of living demonstrates significant upward intragenerational mobility.

Hypothetical Example

Consider Sarah, who begins her career at age 22 as a customer service representative earning $40,000 annually. Through continued education, professional development, and changing employers, she secures a role as a project manager by age 35, earning $80,000 per year. By age 50, she becomes a director, with an annual income of $150,000.

Sarah's intragenerational mobility in terms of income would be:

• Age 22 to 35: A gain of $80,000 - $40,000 = $40,000.
• Age 35 to 50: A gain of $150,000 - $80,000 = $70,000.
• Overall (Age 22 to 50): A total gain of $150,000 - $40,000 = $110,000.

This example illustrates a clear upward intragenerational mobility trajectory driven by strategic career decisions and investment in human capital.

Practical Applications

Intragenerational mobility is a key indicator for policymakers, economists, and individuals in various practical applications.

• Economic Policy Evaluation: Governments and central banks monitor intragenerational mobility to assess the effectiveness of economic policies. For instance, research from the Federal Reserve Bank of San Francisco has explored the consequences of rising income inequality, which can impact mobility within a generation⁸, ⁹. Policies aimed at fostering economic growth and creating job opportunities can directly influence an individual's ability to improve their financial standing over time.
• Labor Market Analysis: Analysts use intragenerational mobility data to understand trends in the labor market. It can reveal whether certain sectors offer more opportunities for advancement or if automation and globalization are creating barriers to upward mobility for some segments of the workforce.
• Individual Financial Planning: For individuals, understanding the dynamics of intragenerational mobility can inform investment strategies and career development plans. Recognizing potential pathways for advancement can motivate investments in education and skill acquisition.
• Social Development Initiatives: International organizations like the International Monetary Fund (IMF) analyze intragenerational mobility as part of their efforts to promote inclusive growth and poverty reduction, particularly in developing economies where income gaps may be widening despite rapid economic expansion⁶, ⁷.

Limitations and Criticisms

While intragenerational mobility provides valuable insights, it faces several limitations and criticisms:

• Data Availability and Quality: Comprehensive, long-term data tracking individuals' socioeconomic status throughout their entire adult lives can be challenging to collect and maintain. Self-reported data may also suffer from inaccuracies.
• Defining Socioeconomic Status: There is no single, universally agreed-upon definition of socioeconomic status. Measures like income, occupation, and wealth distribution can fluctuate, and their relative importance may vary depending on the research question.
• Exogenous Factors: An individual's mobility can be significantly influenced by external factors beyond their control, such as economic recessions, technological shifts, or health crises. These factors can obscure the impact of individual effort or policy interventions. For example, the COVID-19 pandemic led to significant shifts in household liquid wealth, with middle- and lower-income households depleting their accumulated buffers more quickly⁵.
• The "American Dream" Debate: While the "American Dream" often implies substantial upward mobility, recent surveys suggest a divided public on its achievability, particularly among younger and lower-income Americans², ³, ⁴. This perception reflects concerns about the decreasing likelihood of significant intragenerational progress for many.
• Measurement Complexity: Capturing the full spectrum of an individual's socioeconomic experience is complex. For instance, a person might experience upward income mobility but face declining job security or quality of life, which common metrics of intragenerational mobility may not fully capture.

Intragenerational Mobility vs. Intergenerational Mobility

Intragenerational mobility and intergenerational mobility are both critical concepts in the study of social and economic dynamics, but they differ in their focus.

• Intragenerational Mobility: This refers to changes in an individual's socioeconomic standing within their own lifetime. It measures how a person moves up or down the socioeconomic ladder from the point they enter the workforce until retirement. This could involve career advancements, changes in income, shifts in social stratification, or changes in financial stability.
• Intergenerational Mobility: This refers to changes in socioeconomic status between generations. It typically compares a child's socioeconomic position (e.g., income, education, occupation) to that of their parents or grandparents. A common measure is whether children earn more or have higher educational attainment than their parents did. The Pew Charitable Trusts' Economic Mobility Project has extensively studied intergenerational mobility, noting patterns such as "stickiness at the ends" of the income ladder, where those born at the top or bottom tend to remain there¹.

The key distinction lies in the timeframe and the unit of analysis: intragenerational mobility focuses on an individual's journey, while intergenerational mobility examines the transmission of socioeconomic status across family lines.

FAQs

What drives intragenerational mobility?

Intragenerational mobility is driven by a combination of individual factors and broader societal forces. Individual factors include education, skill development, career choices, work ethic, and geographic relocation. Societal factors encompass economic growth, technological advancements, changes in the labor market structure, and government policies related to education, healthcare, and social welfare.

How is intragenerational mobility typically measured?

Intragenerational mobility is commonly measured by tracking changes in an individual's income, occupational status, or wealth over specific periods of their adult life. Longitudinal studies, which follow the same individuals over many years, are essential for capturing these dynamic shifts. Researchers may use income quintiles or occupational prestige scales to quantify movement.

Why is intragenerational mobility important?

Intragenerational mobility is important because it reflects the extent of economic opportunity and fairness within a society. High levels of upward intragenerational mobility suggest that individuals have the chance to improve their lives through effort and skill, contributing to greater overall financial literacy and social cohesion. Conversely, limited mobility can indicate rigid social structures or economic stagnation.

What is the difference between absolute and relative intragenerational mobility?

Absolute intragenerational mobility refers to the total change in an individual's income or wealth over their lifetime, regardless of their position relative to others. For example, an increase in real income represents absolute upward mobility. Relative intragenerational mobility, however, refers to a change in an individual's rank within the income or wealth distribution over time. An individual might experience absolute income growth but still see their relative position decline if others' incomes grow faster.

Can intragenerational mobility be negative?

Yes, intragenerational mobility can be negative, meaning an individual experiences downward mobility over their lifetime. This can occur due to job loss, career stagnation, health issues, significant debt, or adverse economic conditions. For instance, an individual might start in a high-paying job but face a substantial decrease in income and standard of living later in life.