How can we account for inequality when measuring economic mobility❓
Many mobility measures focus on rank changes across generations or time.
But ranks only capture relative positions regardless of income/wealth differences.
New paper w/
@mcgeeconomics.bsky.social: ifs.org.uk/publications...
Nice thread by my coauthor
@socampdi.bsky.social
on a short paper connecting mobility and inequality measurement
We believe this gives an easy to implement tool for measuring mobility when inequality matters and formalizes the link between measurement of inequality and mobility.
All comments welcomed!
🔗ifs.org.uk/publications/beyond-rank...
🇳🇴 Mobility:
• Among women → mobility is mostly horizontal (inequality stable)
• Among men → falling inequality generates meaningful vertical mobility
🇺🇸 Mobility:
• Lorenz mobility < Rank mobility: inequality matters
• Aggregate mobility mostly reflects horizontal mobility
• Vertical mobility is slightly negative because inequality rose between generations
Application: Intergenerational mobility in 🇺🇸 and 🇳🇴
Lorenz mobility uses the same data as rank mobility.
It also allows:
• Net mobility from cross-sectional data (no panel!)
• Status-based IGE & rank-rank equivalents
Net mobility across generations equals the change in the (generalized) Gini coefficient ➡️ When inequality falls, net status mobility rises.
Horizontal mobility is zero-sum in the aggregate (rank switches) ➡️ Net mobility corresponds to vertical mobility (change in Gini!)
Connecting mobility and inequality:
A reduction in inequality (say from Pigou-Dalton transfers) shifts the Lorenz curve up ➡️ increases vertical mobility!
Lorenz mobility decomposes naturally into:
🔄 Horizontal mobility — rank changes holding inequality fixed (moving along the same Lorenz curve)
📈 Vertical mobility — inequality changes holding rank fixed (shifting between Lorenz curves)
We show Lorenz ordinates can be axiomatized as aspirational status:
Status rises when your income gets closer to those richer than you, linking inequality and mobility as status depends on the shape of the income distribution.
We then study the properties of "Lorenz Mobility"
We argue changes in Lorenz ordinates—positions in Lorenz curve—are an informative mobility measure in unequal economies.
A Lorenz ordinate (income share below you) combines:
🔢 Rank (ordinal position)
💰 Income differences (cardinal information)
The problem with rank-based mobility in *unequal* societies:
Large rank changes mean little at the bottom of the distribution, while small rank changes at the top represent large material differences.
The Lorenz Curve captures these differences from inequality❗️
How can we account for inequality when measuring economic mobility❓
Many mobility measures focus on rank changes across generations or time.
But ranks only capture relative positions regardless of income/wealth differences.
New paper w/
@mcgeeconomics.bsky.social: ifs.org.uk/publications...
🚨We are Hiring at the University of Western Ontario🚨
We have 3️⃣ tenure-track positions:
•2 Open-Field
•1 linked to our Masters in Financial Economics (open to various fields)
Come work with us in 🇨🇦! Share with your students!
📄 Open-Field uwo.ca/facultyrelat...
📄 MFE Position uwo.ca/facultyrelat...
We are hosting the Canadian Macroeconomics Study Group at @westernu.ca!
This year's keynote is Kjetil Storesletten @hellerhurwicz.bsky.social
Program 👉 baxter-robinson.github.io/CMSG2025_Pro...
Registration is 100 CAD (70 for students!) 🔗https://economics.uwo.ca/about-us/workshops/index.html
New study compares economic experiences of China and Mexico after they opened to international trade and foreign investment by Xing Xu, PhD student at UMN Econ
@umn-econ.bsky.social and research analyst at Minneapolis Fed @minneapolisfed.bsky.social and me:
www.minneapolisfed.org/research/sta...
Monetary policy shocks affect more cities with low income per capita, both in prices and income. Just Accepted new paper by Juan Herreño @juanherreno.bsky.social and Mathieu Pedemonte @mathpedemonte.bsky.social zurl.co/njzAc
Hello #econtwitter community: if any of you has been teaching any of my papers, would you mind shooting me a DM? I would hugely appreciate that 🙏 and thanks in advance!
Me holding a bike and screaming with strava text showing a completed 124 mile ride for day 2 of my bike ride.
Tomorrow I will be finishing a 321 mile bike ride from Cleveland to Cincinnati to raise money for Gigi's Playhouse Cleveland in memory of my Aunt, Amy Jo Smith.
Amy died in March and Gigi’s Playhouse was her second home since they moved in nearby.
support.gigisplayhouse.org/gigifit-acce...
Next week I will be biking 321 miles from Cleveland to Cincinnati in memory of my Aunt Amy Jo. I am raising money for a nonprofit that supports people with Down Syndrome that was incredibly helpful to my Aunt. support.gigisplayhouse.org/gigifit-acce...
Next was a pair of talks by Hugo Lhuillier (local root of wage inequality) and @socampdi.bsky.social (modeling wealth inequality) at @nber.org www.youtube.com/live/AUIIyL-... (3/6)
Former graduate student Carlos Rondon Moreno and our colleague Christiane Baumeister catching up at a Central Bank of Chile conference:
“Artificial Intelligence and Learning the Macroeconomy: Workshop in Honor of Albert Marcet,” BSE Summer Forum, 19-20 June 2025.
Welcome, @umn-econ.bsky.social! Great to have you posting on here.
#EconSky
Copenhagen is expected to receive 30% more rainfall by the end of the century. The city is responding with a massive long-term adaptation plan. https://n.pr/4dYZOvs
Professor VV Chari in the @startribune.com on the legislation that recently passed the U.S. House: “We’re now out of the pandemic. This is a time for us to pursue perhaps a more responsible fiscal policy, but we seem to be going in exactly the wrong direction.”
www.startribune.com/the-fiscal-i...
Re-upping my advice about how to write a good title and abstract for an academic paper, appropriately called:
"How to Write a Title and Abstract"
Feel free to share this thread, which will focus on titles.
#EconSky #AcademicSky
Corey Wiley on Twitter writes: "You don’t get it. Foundational immigration law is morally just and has been established over millennia. Disrespecting these rules and ideals is very offensive to folks who highly value civilized society"
Not true.
I see you're a luxury watch dealer. I'm also interested in watches. Let me show you how free and easy migration has allowed you to earn a living. 🧵
This is incredible
