Where You Live Affects Your Generational Progress

Generational progress, the feeling that one has a better life than the previous generation, is a significant component of the American Dream. This is a major goal for immigrants as they move to the United States. They want their children to live a better life with more opportunities than they had.


Studies have shown that generational mobility is affected by parental skill and earnings. But does ethnicity also play a role in upward generational mobility? Today, as well as in the past, many people immigrating to the U.S. associate themselves with a particular ethnic group.  Upon entering the country, many people choose to live with and among those with whom they share the same ethnicity or race.  Do such ethnic associations and affiliations affect generational mobility? Recent research suggests that they do.  


A critical finding indicates that the average skills of the ethnic group in the parent’s generation play a large role in the degree of generational mobility realized by children.  Generational income mobility, for instance, will depend not only on parental earnings but also on the mean earnings of the ethic group in the parent’s generation.  This finding has many important implications, not the least of which is that such “ethnic spillover effects” will likely hinder generational progress for relatively disadvantaged ethnic groups.  Although we all may dream of generational improvement for our children, this may not happen for everyone.