The county that a poor family lives in doesn’t just determine what schools or economic opportunities are within their grasp today, it can actually decide how much money their children might earn in 20 years, according to a new study.
Harvard economists Raj Chetty and Nathaniel Hendren – renowned for their research on why low-income families in certain cities are locked out of the middle class – are now challenging the basic concept of the American Dream.
Their Equality of Opportunity Project analyzed county-level data on family movement and income from 1996 through 2012. The Harvard report extends the Moving to Opportunity study commissioned by Congress in the 1990s to analyze the effects of offering housing vouchers to poor families moving to better neighborhoods.
Chetty and Hendren conclude that every year after a child moves to a strong community adds to their future earnings – but every year a child spends in a poor community takes a bit more away from their paycheck as an adult. The key, according to Chetty, is for the child to move as early as possible.
“The data shows we can do something about upward mobility,” he said in a recent interview with The New York Times. “Every extra year of childhood spent in a good neighborhood seems to matter.”
“Geography does not simply separate rich from poor,” wrote David Leonhardt in his New York Times article analyzing the recent findings. “But also plays a large role in determining which poor children achieve the so-called American Dream.”
Matthew O’Brien wrote in The Atlantic that the Harvard study offers a snapshot of not two or three Americas, but hundreds. According to his coverage of the study, kids have a better chance of moving up the economic ladder if they live in the middle states (Utah, Kansas, Iowa or Nebraska), but very little chance if they live in the Deep South.
In Alabama, the findings suggest that if a family is poor, moving to a handful of counties early in their children’s lives would improve their odds of escaping poverty in adulthood.
Which counties offer the best odds for kids in poor families? Cleburne (#630), Dekalb (#635), Coffee (#824), Geneva (#933), and Lawrence (#947) counties were Alabama’s highest ranked counties compared with the rest of the nation.
The study assumes the average household income at age 26 is $26,000. A child growing up in DeKalb County would earn about 8.9 percent more as an adult than if they grew up elsewhere, translating to $2,314 of additional income. In Lawrence County, that additional income drops to $1,378.
By contrast, children in wealthier families have a chance at adding to their future earnings if they live in Fayette (#8), Geneva (#57), Crenshaw (#142), Cullman (#150) or Cleburne (#157) counties. Growing up in Fayette County will boost household income at age 26 by 12.7%, or $3,302; in Cleburne County, that additional income is $2,288 (8.8%)
Here are some of the findings for Alabama’s largest counties:
For an interactive map to see results in another county, click here