Professional Documents
Culture Documents
Using Big Data To Solve Economic and Social Problems: Professor Raj Chetty Head Section Leader: Gregory Bruich, PH.D
Using Big Data To Solve Economic and Social Problems: Professor Raj Chetty Head Section Leader: Gregory Bruich, PH.D
Spring 2019
The Fading American Dream
Percent of Children Earning More than Their Parents, by Year of Birth
Pct. of Children Earning more than their Parents
100
90
80
70
60
50
1940 1950 1960 1970 1980
Child's Year of Birth
Source: Chetty, Grusky, Hell, Hendren, Manduca, Narang (Science 2017)
Why is the American Dream Fading?
80%
Percentage of Empirical Articles
60%
40%
Examples:
Goal of this course: show how same skills can be used to address
important social problems
– We need more talent in this area given pressing challenges such as rising
inequality and global warming
– Start from the questions to motivate the methods rather than the traditional
approach of doing the reverse
Overview of Topics
1. Equality of Opportunity
2. Education
3. Racial Disparities
4. Health
5. Criminal Justice
6. Tax Policy
7. Climate Change
3. Competitive equilibrium
4. Adverse selection
We recognize that not everyone taking this class has the same
background in statistics and economics
– Some students have taken many courses already, others are just starting
– Please respond to emails you will receive this week asking about your prior
coursework and preferences
Empirical Projects
Topic I
Equality of Opportunity
Lecture 1 Outline
Part 1
Geographical Variation in Upward Mobility
Differences in Opportunity Across Local Areas
– Are there some areas where kids do better than others? If so, what lessons
can we learn from them?
Recent studies have used big data to measure how upward mobility
varies based on where children grow up
The Opportunity Atlas
Data Sources and Sample Definitions
Data sources: Anonymized Census data (2000, 2010, ACS) covering U.S.
population linked to federal income tax returns from 1989-2015
Target sample: Children in 1978-83 birth cohorts who were born in the U.S.
or are authorized immigrants who came to the U.S. in childhood
Analysis sample: 20.5 million children, 96% coverage rate of target sample
Measuring Parents’ and Children’s Incomes in Tax Data
Rank children relative to others born in the same year and parents relative to
other parents
Intergenerational Income Mobility for Children Raised in Chicago
Average Child Household Income Rank vs. Parent Household Income Rank
0 10 20 30 40 50 60 70 80 90 100
Source: Chetty, Hendren, Kline, Saez 2014 Parent Rank in National Income Distribution
Intergenerational Income Mobility for Children Raised in a Hypothetical Census Tract
Average Child Household Income Rank vs. Parent Household Income Rank
0 10 20 30 40 50 60 70 80 90 100
Parent Rank in National Income Distribution
Estimating Children’s Average Outcomes by Census Tract
Run a separate regression using data for children who grow up in each Census
tract in America
– Weight children by fraction of childhood (up to age 23) spent in a given area
The Geography of Upward Mobility in the United States
Average Household Income for Children with Parents Earning $27,000 (25th percentile)
Seattle
Salt Lake City $37.2k Dubuque
$35.2k
$45.5k Cleveland
$29.4k
Boston $36.8k
Los Angeles
$34.3k
Atlanta
$26.6k
$33.7k