13 ms·

The self-made man

92 points by dkoch 12y ago

twoodfin 12y ago
I'm pretty skeptical of the study on which this essay bases its premise that economic mobility in the U.S. is limited compared to, say, France. The most detailed information I can find online is the executive summary[1], which has to handwave that it found Italy with a strongly negative correlation between parents' and children's economic outcomes! That suggests to me that their methodology is not particularly robust. I've found similar attempts to establish parent/child economic correlation equally suspicious when, for example, they measure income correlation with percentiles rather than in adjusted dollars (it's much easier to be "mobile" if there's only $10K in income separating the 40th and 60th percentiles!) [1] http://www.pewtrusts.org/~/media/legacy/uploadedfiles/pcs_assets/2011/CRITAFINAL1pdf.pdf http://www.pewtrusts.org/~/media/legacy/uploadedfiles/pcs_as...
- tehrania 12y ago
  That's the whole point of economic mobility, to measure it against income and inequality.
  - twoodfin 12y ago
    No, that's not the point. A society with almost no income inequality, where everyone makes almost exactly the same amount, would have nearly perfect "mobility" as measured by the correlation between the percentile of parent and child earnings (a few random dollars would move you a lot!). But it wouldn't be a "mobile" society in the sense we usually mean, where the poor can become rich (and vice versa) because there would be no poor and no rich!
    - kcorbitt 12y ago
      It depends on what you're trying to measure by "economic mobility" though. I can think of valid reasons to want to know the percentile change between a person and their parents, irrespective of the absolute value difference, and reasons to be interested in the different-but-related measure of absolute change in income/quality of life. It's generally better to start with the question "what do I want to know?" and then looking for a suitable statistical framework that will answer that question, rather than starting with a ready-made statistical analysis and then trying to use it to answer arbitrary questions.
      - twoodfin 12y ago
        I can think of valid reasons to want to know the percentile change between a person and their parents, irrespective of the absolute value difference, and reasons to be interested in the different-but-related measure of absolute change in income/quality of life. Sure, but when comparing nation A to nation B, it's generally more interesting to look at either the absolute dollar difference or some relative quality-of-life measure (you could call the latter "class", I guess). Folks moving around within a tightly distributed income distribution don't really gain or lose much of either, relative to someone in a society with larger disparities.
    - watwut 12y ago
      Mobility is about moving between classes of society. So, the society you just described would be rightfully described as having high social mobility. What it probably does not have is high average wealth.
      - twoodfin 12y ago
        So, the society you just described would be rightfully described as having high social mobility. But it would just be economic Brownian motion. Social mobility isn't (I hope!) valued because it shows that a society produces random outcomes, but rather that it enables people to achieve to the limit of their talents.
        watwut 12y ago
        Social mobility is defined somehow and that somehow is not "the absolute total measure of fairness of any society". And speaking about virtually any country in the world, including North Korea, they all have lower class and upper class. Your worry about totally classless society is purely theoretical. If we would live in classless society, social mobility would be less important measure. Plus, you define achieving the limit of the talent in purely financial form. If I am genius mathematician, achieving limits of the talent mean doing great (potentially useful) math somewhere at the university. That does not translate to neither "high class" nor "rich".
- TheOtherHobbes 12y ago
  The same results have been reported by many other studies. The facts are clear - for the poor the US is a land of economic handicap, not a land of opportunity. There will always be individual exceptions to this, but they'll be single data points. Put crudely, for every heart-warming success you see interviewed in Forbes, there will be millions of failures no one hears about. The most useful picture is broad-based and statistical, and studies like this one: http://www.equality-of-opportunity.org/ http://www.equality-of-opportunity.org/ show that mobility depends as much on where you were born as to whom you were born. Broadly, inequality has exploded since the 1980s and in areas with limited social capital - including good free education - it's now more difficult than ever to work your way up from the bottom. But this is balanced by increased opportunities in other areas - mostly affluent, mostly urban - which have created a halo effect for the poorer communities around them. So average mobility has remained approximately constant, but only because bad areas have been balanced by good areas. Meanwhile average mobility in the US continues to be worse than mobility in other countries.
  - twoodfin 12y ago
    Meanwhile average mobility in the US continues to be worse than mobility in other countries. What's the best study you can find that demonstrates this? I haven't seen any that don't appear to succumb to the flaws I mentioned elsewhere in this thread, such as measuring relative mobility instead of absolute mobility.
    - TheOtherHobbes 12y ago
      We should probably define terms first. Which definitions of absolute and relative are you using? (There are a few, and they're not identical.)
      - happyscrappy 12y ago
        Do you have a citation or not?
      - twoodfin 12y ago
lukifer 12y ago
Humans have a problem with complexity and compound causality in general; any person who succeeds does so by some combination of both individual grit, and support from society and loved ones (even if indirectly), regardless of what the proportions happen to be (if one could even measure such a thing). Thinking that success must derive exclusively from either society or the individual is sheer absurdity, driven by a need to impose an idealized narrative upon messy reality.
- 300bps 12y ago
  Yet there are some people that work 60 hours per week and some that choose to not work at all. The people in the first camp are typically more successful than people in the second camp. Articles like the OP discount their efforts and accomplishments completely.
  - jmclean 12y ago
    I think part of the reason this conversation is valuable, though, is that the inverse omission is far more dominant in the cultural conversation right now. It's certainly mostly true that hard work plays an important part in fantastic success. But it's equally true that even in those cases, the majority enjoyed advantages that are often invisible even to them. So to be sure, the opposite extreme is just as ridiculous as suggesting that every person exists in a bubble where their effort correlates exactly with outcome. But when the awareness of systemic advantage is absent (as it certainly is), I see staking out a far extreme opinion like this as a challenge to find a more reasonable center.
    - TheOtherHobbes 12y ago
      The work ethic narrative is immensely useful to employers, but in too many situations it's almost totally disconnected from real opportunity and reward. Ultimately it's a political problem - but not necessarily in the obvious sense. The most successful and fun cultures reward inventiveness and positive social contributions, and include some element of challenge and competition. But using money and markets to make decisions about the kinds of activities that are rewarded turns out to be an inefficient, short-sighted and often surreal way to manage what does and doesn't get valued.
calinet6 12y ago
Aside from the political discussion bound to happen here, I was surprised and happy to see the story of Hilltop highlighted. I used to buy filet mignon there for $7 a pound back in 2009 when I was living in Chelsea, as a recent migrant from California. I was very sad when it closed, and never knew the story. It highlights a more general point: we, as humans, have a profound attribution bias. It's psychological. We tend to attribute success to our own individual characteristics, actions, and free will. Americans significantly more so.[http://www.jstor.org/discover/10.2307/2786780?uid=2&uid=4&sid=21104247453601 http://www.jstor.org/discover/10.2307/2786780?uid=2&uid=4&si...] This would be fine, if it were true; however this attribution bias causes a significant departure from reality. When people succeed, we tend to focus on their personal attributes and actions, instead of looking at the situation surrounding them. When we do that, we tend to think of them as "rising above their situation," or "using their advantages well." We like to think we can do the same, but it is truly a kind of collective delusion. We have to recognize that this is simply fantasy. It's not backed up by truth. Statistics says much the opposite: that most people who try will fail, and that people will be significantly burdened by failure, and that people who have failed or succeeded are extremely affected by external effects; that most successes are the result of both individual and significant historical and contextual factors. Externalities are more important than we want to believe. They're not everything, but they deserve much, much more attention than they get, which is often nil. We would be a different kind of society were we to match our perception of success and failure with the reality of that success or failure. We don't have to give up our sense of individualism and the respect for personal growth and contribution; we just need to back it up with a recognition of the surrounding factors that are extremely real and highly influential on all our lives. I know we would be a better society if we did.
- jeffreyrogers 12y ago
  > We would be a different kind of society were we to match our perception of success and failure with the reality of that success or failure. We don't have to give up our sense of individualism and the respect for personal growth and contribution; we just need to back it up with a recognition of the surrounding factors that are extremely real and highly influential on all our lives. I know we would be a better society if we did. This is a really good point, and it's something I've been thinking about lately too. Fortunately, I've seen a growing appreciation for the role luck and circumstance has in people's success, particularly with regard to educational opportunities and social class, so hopefully this is starting to change.
nateabele 12y ago
> "Or is it more like a mass delusion keeping us from confronting the fact that poor Americans tend to remain poor Americans, regardless of how hard they work?" The language used here is interesting. Wasn't the labor theory of value thrown out a while ago?
justintocci 12y ago
yeah but I'm always struck by how many successful people started out through some criminal act. Andrew Carnegie apparently committed fraud to get his start. That was a new one to me.

92 points by dkoch 12y ago

I'm pretty skeptical of the study on which this essay bases its premise that economic mobility in the U.S. is limited compared to, say, France. The most detailed information I can find online is the executive summary[1], which has to handwave that it found Italy with a strongly negative correlation between parents' and children's economic outcomes! That suggests to me that their methodology is not particularly robust. I've found similar attempts to establish parent/child economic correlation equally suspicious when, for example, they measure income correlation with percentiles rather than in adjusted dollars (it's much easier to be "mobile" if there's only $10K in income separating the 40th and 60th percentiles!) [1] http://www.pewtrusts.org/~/media/legacy/uploadedfiles/pcs_assets/2011/CRITAFINAL1pdf.pdf http://www.pewtrusts.org/~/media/legacy/uploadedfiles/pcs_as...

tehrania 12y ago
That's the whole point of economic mobility, to measure it against income and inequality.
- twoodfin 12y ago
  No, that's not the point. A society with almost no income inequality, where everyone makes almost exactly the same amount, would have nearly perfect "mobility" as measured by the correlation between the percentile of parent and child earnings (a few random dollars would move you a lot!). But it wouldn't be a "mobile" society in the sense we usually mean, where the poor can become rich (and vice versa) because there would be no poor and no rich!
  - kcorbitt 12y ago
    It depends on what you're trying to measure by "economic mobility" though. I can think of valid reasons to want to know the percentile change between a person and their parents, irrespective of the absolute value difference, and reasons to be interested in the different-but-related measure of absolute change in income/quality of life. It's generally better to start with the question "what do I want to know?" and then looking for a suitable statistical framework that will answer that question, rather than starting with a ready-made statistical analysis and then trying to use it to answer arbitrary questions.
    - twoodfin 12y ago
      I can think of valid reasons to want to know the percentile change between a person and their parents, irrespective of the absolute value difference, and reasons to be interested in the different-but-related measure of absolute change in income/quality of life. Sure, but when comparing nation A to nation B, it's generally more interesting to look at either the absolute dollar difference or some relative quality-of-life measure (you could call the latter "class", I guess). Folks moving around within a tightly distributed income distribution don't really gain or lose much of either, relative to someone in a society with larger disparities.
  - watwut 12y ago
    Mobility is about moving between classes of society. So, the society you just described would be rightfully described as having high social mobility. What it probably does not have is high average wealth.
    - twoodfin 12y ago
      So, the society you just described would be rightfully described as having high social mobility. But it would just be economic Brownian motion. Social mobility isn't (I hope!) valued because it shows that a society produces random outcomes, but rather that it enables people to achieve to the limit of their talents.
      - watwut 12y ago
        Social mobility is defined somehow and that somehow is not "the absolute total measure of fairness of any society". And speaking about virtually any country in the world, including North Korea, they all have lower class and upper class. Your worry about totally classless society is purely theoretical. If we would live in classless society, social mobility would be less important measure. Plus, you define achieving the limit of the talent in purely financial form. If I am genius mathematician, achieving limits of the talent mean doing great (potentially useful) math somewhere at the university. That does not translate to neither "high class" nor "rich".
TheOtherHobbes 12y ago
The same results have been reported by many other studies. The facts are clear - for the poor the US is a land of economic handicap, not a land of opportunity. There will always be individual exceptions to this, but they'll be single data points. Put crudely, for every heart-warming success you see interviewed in Forbes, there will be millions of failures no one hears about. The most useful picture is broad-based and statistical, and studies like this one: http://www.equality-of-opportunity.org/ http://www.equality-of-opportunity.org/ show that mobility depends as much on where you were born as to whom you were born. Broadly, inequality has exploded since the 1980s and in areas with limited social capital - including good free education - it's now more difficult than ever to work your way up from the bottom. But this is balanced by increased opportunities in other areas - mostly affluent, mostly urban - which have created a halo effect for the poorer communities around them. So average mobility has remained approximately constant, but only because bad areas have been balanced by good areas. Meanwhile average mobility in the US continues to be worse than mobility in other countries.
- twoodfin 12y ago
  Meanwhile average mobility in the US continues to be worse than mobility in other countries. What's the best study you can find that demonstrates this? I haven't seen any that don't appear to succumb to the flaws I mentioned elsewhere in this thread, such as measuring relative mobility instead of absolute mobility.
  - TheOtherHobbes 12y ago
    We should probably define terms first. Which definitions of absolute and relative are you using? (There are a few, and they're not identical.)
    - happyscrappy 12y ago
      Do you have a citation or not?
    - twoodfin 12y ago

lukifer 12y ago

Humans have a problem with complexity and compound causality in general; any person who succeeds does so by some combination of both individual grit, and support from society and loved ones (even if indirectly), regardless of what the proportions happen to be (if one could even measure such a thing). Thinking that success must derive exclusively from either society or the individual is sheer absurdity, driven by a need to impose an idealized narrative upon messy reality.

300bps 12y ago
Yet there are some people that work 60 hours per week and some that choose to not work at all. The people in the first camp are typically more successful than people in the second camp. Articles like the OP discount their efforts and accomplishments completely.
- jmclean 12y ago
  I think part of the reason this conversation is valuable, though, is that the inverse omission is far more dominant in the cultural conversation right now. It's certainly mostly true that hard work plays an important part in fantastic success. But it's equally true that even in those cases, the majority enjoyed advantages that are often invisible even to them. So to be sure, the opposite extreme is just as ridiculous as suggesting that every person exists in a bubble where their effort correlates exactly with outcome. But when the awareness of systemic advantage is absent (as it certainly is), I see staking out a far extreme opinion like this as a challenge to find a more reasonable center.
  - TheOtherHobbes 12y ago
    The work ethic narrative is immensely useful to employers, but in too many situations it's almost totally disconnected from real opportunity and reward. Ultimately it's a political problem - but not necessarily in the obvious sense. The most successful and fun cultures reward inventiveness and positive social contributions, and include some element of challenge and competition. But using money and markets to make decisions about the kinds of activities that are rewarded turns out to be an inefficient, short-sighted and often surreal way to manage what does and doesn't get valued.

calinet6 12y ago

Aside from the political discussion bound to happen here, I was surprised and happy to see the story of Hilltop highlighted. I used to buy filet mignon there for $7 a pound back in 2009 when I was living in Chelsea, as a recent migrant from California. I was very sad when it closed, and never knew the story. It highlights a more general point: we, as humans, have a profound attribution bias. It's psychological. We tend to attribute success to our own individual characteristics, actions, and free will. Americans significantly more so.[http://www.jstor.org/discover/10.2307/2786780?uid=2&uid=4&sid=21104247453601 http://www.jstor.org/discover/10.2307/2786780?uid=2&uid=4&si...] This would be fine, if it were true; however this attribution bias causes a significant departure from reality. When people succeed, we tend to focus on their personal attributes and actions, instead of looking at the situation surrounding them. When we do that, we tend to think of them as "rising above their situation," or "using their advantages well." We like to think we can do the same, but it is truly a kind of collective delusion. We have to recognize that this is simply fantasy. It's not backed up by truth. Statistics says much the opposite: that most people who try will fail, and that people will be significantly burdened by failure, and that people who have failed or succeeded are extremely affected by external effects; that most successes are the result of both individual and significant historical and contextual factors. Externalities are more important than we want to believe. They're not everything, but they deserve much, much more attention than they get, which is often nil. We would be a different kind of society were we to match our perception of success and failure with the reality of that success or failure. We don't have to give up our sense of individualism and the respect for personal growth and contribution; we just need to back it up with a recognition of the surrounding factors that are extremely real and highly influential on all our lives. I know we would be a better society if we did.

jeffreyrogers 12y ago
> We would be a different kind of society were we to match our perception of success and failure with the reality of that success or failure. We don't have to give up our sense of individualism and the respect for personal growth and contribution; we just need to back it up with a recognition of the surrounding factors that are extremely real and highly influential on all our lives. I know we would be a better society if we did. This is a really good point, and it's something I've been thinking about lately too. Fortunately, I've seen a growing appreciation for the role luck and circumstance has in people's success, particularly with regard to educational opportunities and social class, so hopefully this is starting to change.

nateabele 12y ago

> "Or is it more like a mass delusion keeping us from confronting the fact that poor Americans tend to remain poor Americans, regardless of how hard they work?" The language used here is interesting. Wasn't the labor theory of value thrown out a while ago?

justintocci 12y ago

yeah but I'm always struck by how many successful people started out through some criminal act. Andrew Carnegie apparently committed fraud to get his start. That was a new one to me.