A Broken Social Elevator? How to Promote Social Mobility

image of A Broken Social Elevator? How to Promote Social Mobility

This report provides new evidence on social mobility in the context of increased inequalities of income and opportunities in OECD and selected emerging economies. It covers the aspects of both social mobility between parents and children and of personal income mobility over the life course, and their drivers. The report shows that social mobility from parents to offspring is low across the different dimensions of earnings, education, occupation and health, and that the same prevails for personal income mobility over the life course. There is in particular a lack of mobility at the bottom and at the top of the social ladder – with “sticky floors” preventing upward mobility for many and “sticky ceilings” associated with opportunity hoarding at the top. The lack of social mobility has economic, societal and political consequences. This report shows that there is space for policies to make societies more mobile and protect households from adverse income shocks. It discusses the options and measures that policy makers can consider how to improve social mobility across and within generations.

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Time is money: What drives income mobility?

This chapter investigates the key drivers of household income mobility from an individual perspective. It considers the impact of so-called “trigger events” – such as changes in labour market status, divorce or childbirth – on income mobility. The chapter shows that changes in labour market status are the main determinant of individual income trajectories, but that, in a number of countries, family-related changes can also play a very important role. In particular, women are more severely affected than men by income losses after a divorce. Net social transfers are a crucial factor to prevent downward mobility, while upward mobility results primarily from labour market dynamics.

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