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That's not actually true at all. The US has lower social mobility than most wealthy European countries. Thus, there are actually fewer opportunities for most pe

by cultus 7y ago

That's not actually true at all. The US has lower social mobility than most wealthy European countries. Thus, there are actually fewer opportunities for most people to create wealth for themselves compared to countries with more equality. It's hard to start a business, if, like the vast majority of people, you don't have a bunch of excess money sitting around. https://www.forbes.com/sites/aparnamathur/2018/07/16/the-u-s-does-poorly-on-yet-another-metric-of-economic-mobility/#1dab24b66a7b https://www.forbes.com/sites/aparnamathur/2018/07/16/the-u-s... https://www.economist.com/graphic-detail/2018/02/14/americans-overestimate-social-mobility-in-their-country https://www.economist.com/graphic-detail/2018/02/14/american...

nostrademons 7y ago
Quintile graphs obscure absolute magnitudes. Most of the people that have a realistic chance of making it into the upper income/wealth quintiles come from relatively high social strata already (either within the U.S or, if they're an immigrant, within their home countries), but they want that high percentile to mean more in absolute terms. In other words, if you come from the upper end of the distribution, income inequality is a feature not a bug.
- deleted 7y ago
  [deleted]
refurb 7y ago
The is a fatal flaw with the way they measure mobility in these studies because the income quintiles are skewed much higher in the US. Take this scenario: 1. You go from 1st quintile (10K EUR) to 5th quintile (100K EUR) in Europe. 2. You go from 1st quintile ($10K) to 4th quintile ($110K) in the US. By this measure, Europe has better mobility, but the person in the US ends up with a higher income.
- geocar 7y ago
  I don't think using quintiles is unfair. Consider thinking about it using an extreme: If I'm earning (and spending) in the top percentile in NYC or London, I assuredly have a very nice standard of living, but the effort (personal growth, career, etc) to move to that top percentile from anywhere else is far lower in London than it is in NYC.
  - nostrademons 7y ago
    Is that actually true? In refurb's example, you can move from the 4th quintile in the U.S. to the 5th quintile in London simply by moving from the U.S. to London and holding everything else constant. In my career, the biggest bumps in compensation have been through events that I had little to do with. Pick the right industry and company, pass the hiring bar, have their wage-fixing cartel broken by Facebook, and let stock-price appreciation do the rest. I worked hard, but I worked hard mostly because what else am I going to do with my time? I also feel like there's a difference in working models between your post (and by extension, most middle-class and lower people) and how people actually get to the top income & wealth percentiles. Most people believe it happens through hard work: put in the hours, learn the material, diligently do what you're told, get a steady stream of promotions, and you'll get rich. In practice, this usually results in a series of 6-7% wage increases that keep you roughly where you were within the relative distribution, because everybody else is doing the same thing. All really big fortunes are made through arbitrage: identify a problem that lots of people really want solved, present yourself as the solution to that problem, profit. Work is required for this, but the returns from it are highly non-linear: you might work a little more (or sometimes even less) than someone who slaves away at their career, but get orders of magnitude more return.
    - geocar 7y ago
      Moving simply to London is not an easy task though, even for a high earner.

by cultus 7y ago

nostrademons 7y ago

Quintile graphs obscure absolute magnitudes. Most of the people that have a realistic chance of making it into the upper income/wealth quintiles come from relatively high social strata already (either within the U.S or, if they're an immigrant, within their home countries), but they want that high percentile to mean more in absolute terms. In other words, if you come from the upper end of the distribution, income inequality is a feature not a bug.

deleted 7y ago
[deleted]

refurb 7y ago

The is a fatal flaw with the way they measure mobility in these studies because the income quintiles are skewed much higher in the US. Take this scenario: 1. You go from 1st quintile (10K EUR) to 5th quintile (100K EUR) in Europe. 2. You go from 1st quintile ($10K) to 4th quintile ($110K) in the US. By this measure, Europe has better mobility, but the person in the US ends up with a higher income.

geocar 7y ago
I don't think using quintiles is unfair. Consider thinking about it using an extreme: If I'm earning (and spending) in the top percentile in NYC or London, I assuredly have a very nice standard of living, but the effort (personal growth, career, etc) to move to that top percentile from anywhere else is far lower in London than it is in NYC.
- nostrademons 7y ago
  Is that actually true? In refurb's example, you can move from the 4th quintile in the U.S. to the 5th quintile in London simply by moving from the U.S. to London and holding everything else constant. In my career, the biggest bumps in compensation have been through events that I had little to do with. Pick the right industry and company, pass the hiring bar, have their wage-fixing cartel broken by Facebook, and let stock-price appreciation do the rest. I worked hard, but I worked hard mostly because what else am I going to do with my time? I also feel like there's a difference in working models between your post (and by extension, most middle-class and lower people) and how people actually get to the top income & wealth percentiles. Most people believe it happens through hard work: put in the hours, learn the material, diligently do what you're told, get a steady stream of promotions, and you'll get rich. In practice, this usually results in a series of 6-7% wage increases that keep you roughly where you were within the relative distribution, because everybody else is doing the same thing. All really big fortunes are made through arbitrage: identify a problem that lots of people really want solved, present yourself as the solution to that problem, profit. Work is required for this, but the returns from it are highly non-linear: you might work a little more (or sometimes even less) than someone who slaves away at their career, but get orders of magnitude more return.
  - geocar 7y ago
    Moving simply to London is not an easy task though, even for a high earner.