"In a maximally meritocratic society a parent’s wealth would have no impact on the economic conditions of their children."
I don't think this is completely true. In a maximally meritocratic society one's economic conditions would depend on their productivity. There are several things that impact productivity that come from parents. Genetic determinants of IQ and personality, how the parents choose to raise their children, how the parents choose to spend money on their children, and what opportunities that parents make available to their kids. Since we're in a maximally meritocratic society in this hypothetical, it stands to reason that parents in the high productivity quintiles would be better in several respects at producing high productivity children. Since the ability to pass on and cultivate merit in children depends in part on the merit of parents, the children's income would correlate with their parent's income.
That being said, I definitely agree that the US is not a maximally meritocratic society and that we should take down barriers to participation and competition ASAP. Occupational licensing is a huge barrier to competition and participation that comes to mind. Moving to cities has been the source of most of the globe's social mobility over the past millennia so freeing them of regulation and allowing them to grow would also explode social mobility. Border controls are also obviously a huge barrier to international social mobility.
I think you shed light on a serious mobility issue in the US. But the standard you hold the country to is too strict, and here's why:
1) Even if you "unrig" parts of the economy (which currently has anti-capitalistic elements that seek to consolidate power), money *naturally* opens the door to more economic opportunities. In a fair free market, if you and I own small businesses but I have 2x as much wealth, I have greater opportunity to expand my future wealth through new hirings, franchises, etc.
2) Wealth is transferred from generation to generation within a family as a natural course of property rights
3) 1 and 2 together imply that in a (procedurally) fair, capitalist society, there will naturally be a >20% chance a top-quintiler's child remains in the top quintile, and a <20% chance a bottom-quintiler moves up that high. More generally, it will be easier to remain in your parent's quintile than to move up one; easier to move up one than move up two, etc.
So for your desired "equal opportunity" condition (i.e. no statistical dependence between your parents' quintile and your own) to take hold, you'd have to do some SERIOUS intervention against 3); something hugely systemic to penalize or transfer greater amounts of wealth so that the properties of 1) no longer flow across generations in any way. So if I have more wealth than you, I might unlock more opportunity for myself in my lifetime, but my and your children should each have the same financial inheritance somehow.
Wow, great post Grady!
"In a maximally meritocratic society a parent’s wealth would have no impact on the economic conditions of their children."
I don't think this is completely true. In a maximally meritocratic society one's economic conditions would depend on their productivity. There are several things that impact productivity that come from parents. Genetic determinants of IQ and personality, how the parents choose to raise their children, how the parents choose to spend money on their children, and what opportunities that parents make available to their kids. Since we're in a maximally meritocratic society in this hypothetical, it stands to reason that parents in the high productivity quintiles would be better in several respects at producing high productivity children. Since the ability to pass on and cultivate merit in children depends in part on the merit of parents, the children's income would correlate with their parent's income.
That being said, I definitely agree that the US is not a maximally meritocratic society and that we should take down barriers to participation and competition ASAP. Occupational licensing is a huge barrier to competition and participation that comes to mind. Moving to cities has been the source of most of the globe's social mobility over the past millennia so freeing them of regulation and allowing them to grow would also explode social mobility. Border controls are also obviously a huge barrier to international social mobility.
I think you shed light on a serious mobility issue in the US. But the standard you hold the country to is too strict, and here's why:
1) Even if you "unrig" parts of the economy (which currently has anti-capitalistic elements that seek to consolidate power), money *naturally* opens the door to more economic opportunities. In a fair free market, if you and I own small businesses but I have 2x as much wealth, I have greater opportunity to expand my future wealth through new hirings, franchises, etc.
2) Wealth is transferred from generation to generation within a family as a natural course of property rights
3) 1 and 2 together imply that in a (procedurally) fair, capitalist society, there will naturally be a >20% chance a top-quintiler's child remains in the top quintile, and a <20% chance a bottom-quintiler moves up that high. More generally, it will be easier to remain in your parent's quintile than to move up one; easier to move up one than move up two, etc.
So for your desired "equal opportunity" condition (i.e. no statistical dependence between your parents' quintile and your own) to take hold, you'd have to do some SERIOUS intervention against 3); something hugely systemic to penalize or transfer greater amounts of wealth so that the properties of 1) no longer flow across generations in any way. So if I have more wealth than you, I might unlock more opportunity for myself in my lifetime, but my and your children should each have the same financial inheritance somehow.
Do you still think this is a desirable system?
Great post but what are some solutions?