How education transformed opportunity in America

When America is described as a “land of opportunity,” the sentiment comes from the belief that a child’s destiny need not be the destiny of their parents. Children can grow up to be who they want to be, to achieve what they seek to achieve, regardless of the circumstances of their birth or upbringing.

In a fully immobile society, the background of parents would perfectly predict the outcomes of their children. In a fully mobile society, the background of parents would not predict the outcomes of their children at all.

Of course, most societies fall somewhere between these extremes. How mobile has American society been through its history, and what factors have shaped its mobility? Former Institute visiting scholars Lukas Althoff and Hugo Reichardt, with co-author Harriet Brookes Gray, examine mobility in America from 1850 to 1950 in a new Institute working paper.

Historical analyses of intergenerational mobility usually look at fathers and sons because historical records include more information about men than women. Althoff, Gray, and Reichardt break ground by putting together a new dataset that includes mothers and daughters. This more complete view of parents and children shows that from the 1850s through 1890s, mothers played a large role in shaping their children’s outcomes. After the introduction of mass schooling in the late 19th century, the influence of mothers declined as education made American society more mobile.

Putting women in the picture

To measure how mobile a society is, we have to decide what outcome we want to assess. Contemporary analyses of mobility usually look at how similar adult children’s income is to that of their parents. Because historical income data are limited, analyses of mobility in America’s past often compare the occupations of fathers with the occupations of their sons to see how parental background influences children’s future outcomes.

Althoff, Gray, and Reichardt wanted to include mothers and daughters in their analysis, but women—and married women in particular—frequently had no formal income or occupation in the late 19th and early 20th centuries. So instead, the economists focus on “human capital”—that is, the skills and abilities that allow one to earn money and consume goods and services.

Gary Becker, an economist who pioneered the study of human capital and its role in economic growth, wrote in his seminal book on the topic that “education and training are the most important investments in human capital.” Althoff, Gray, and Reichardt use the ability to read and write, which was recorded on the decennial census for all household members 10 years and older, as their measure of human capital.

Literacy is a useful way to measure human capital because it is foundational to the acquisition of many other skills. “To learn many things, you need to learn how to read and write,” Althoff said. “Literacy-based human capital is really an essential form of human capital that drives many other forms of human capital.”

Including mothers in the analysis requires building a new dataset that tracks family relationships. Starting in 1850, the decennial census asked for respondents’ full names. The economists then use Social Security number applications to track women’s names after marriage, allowing them to follow women from childhood to adulthood and to link married men and women. Personal information on census records is kept confidential for 72 years, so the analysis currently ends in 1950, the last census that is publicly available. In all, the new dataset includes 42 million people who are tracked across an average of four census records.

The power of mothers’ human capital

With their new dataset in hand, the economists look at how much of the variation in children’s human capital is explained by their parents’ background over the 100 years from 1850 to 1950. For children born in the early part of this period, parental background matters a lot, accounting for 65 percent of the variation in children’s human capital (Figure 1). For those born in the latter part, parental background matters a lot less, explaining just 35 percent of the variation in children’s outcomes. As the century clicked over from the 1800s to 1900s, society became more mobile.

Because mothers’ and fathers’ ability to read and write are measured separately in the census, the economists can look at how much of children’s outcomes are explained by their mother’s background versus their father’s. This analysis shows that mothers’ human capital is a stronger predictor than fathers’ human capital. This is particularly true for female children and Black children, who had less access to formal education than White male children.

These findings challenge traditional narratives about the drivers of social mobility in America, which usually emphasize the role of fathers. Instead, the findings suggest that the informal education provided at home by mothers was a crucial factor in shaping children’s futures, particularly in the late 1800s.

Including mothers also changes how we interpret mobility patterns in different regions of the country. Research based on the occupations of fathers and sons found that the South, Midwest, West, and Northeast all had similar rates of intergenerational mobility around 1900. Including mothers reduces the estimate of mobility in the South by about 25 percent, while estimates for other regions fall less. Why? Mothers were more important to their children’s outcomes in the South because there were fewer schools.

“Mothers are really key figures that determine why some kids are able to pick a different occupation than their father,” Althoff said. “To tell the full story, especially historically, you have to deviate from income relationships and think carefully about the roles that parents play. And historically for mothers, that was transmitting human capital in the home.”

The rise of public education and its impact on mobility

As the 19th century gave way to the 20th, a dramatic shift occurred in American education. Between 1880 and 1990, school attendance among children ages 6 to 13 rose from below 60 percent to over 90 percent, replacing home education as the primary source of human capital formation. This expansion of public education increased human capital mobility in America. Figure 2 shows that mobility was higher in states where a larger share of children attended school.

In addition, the economists find that mothers’ human capital played less of a role in their children’s human capital where schooling was more widespread. The influence of fathers, however, does not show a correlation with schooling. This provides additional evidence that the influence of mothers in the late 1800s was largely due to their role in educating their children.

Access to schooling did not progress evenly for all groups of children, however. For Black children, their mobility rose sharply in the 1870s and 1880s after slavery ended and they gained access to education. During that period, White children’s mobility was relatively flat. Then, mobility for Black children declined while it rose for White children.

These patterns appear to align with historical shifts. “After emancipation … Black Americans’ literacy surged for the first time in generations,” the economists write. “However, beginning in 1877, Southern states imposed new restrictions on Black education.” The lack of access to quality education may explain why mobility declined for Black children born between 1880 and 1920.

The interplay of human capital and income mobility

While Althoff, Gray, and Reichardt focus primarily on human capital mobility, they also examine trends in income mobility. The researchers find that income mobility rose in tandem with human capital mobility from 1850 to 1950. This suggests that the expansion of education not only increased equality of opportunity in terms of knowledge and skills but may also translate into greater economic opportunity.

“The question is, How do countries manage to allow people to go from rags to riches?” Althoff said. “Is it historical coincidence? Is it culture? Maybe it’s just that the risk-takers migrated to America and that’s where they still are. Or is it institutions? And this is really our answer to it. We think it is policy driven, namely, the U.S. became the country of opportunity through investment decisions that the government made to provide mass education to everyone regardless of background.”

Althoff sees these lessons from the past applying to today as well. “If you look at school spending today, there are several countries—not many, but there are several like South Korea, some of the Nordic countries—that spend even more than the U.S. on per capita education,” he said. “These also tend to be countries where mobility is high and on the rise.”