How Cultural Factors Shape Economic Outcomes: Introducing the Issue

Children’s economic and social outcomes, both during their childhood and in their adult years, largely depend on the circumstances into which they are born and raised. Such circumstances are the product of children’s families, schools, and neighborhoods; the peers and adults with whom they spend time; the media images that shape their perceptions of themselves and their place in the world; and other factors—both internal and external to the individual child. Many would say that culture plays a large role in shaping a child’s life experiences and outcomes. But culture is hard to define and quantify, and controversial to talk about, especially as an ill-defined concept. Furthermore, the question of what—if anything—policy makers and practitioners can do about culture is hard to grapple with, unlike more readily measured and studied concepts like income or educational attainment.

This issue of the Future of Children aims to identify and measure elements of culture that predict children’s economic and social outcomes, and to present the best evidence to date about how these factors shape children’s economic outcomes. When we use the word culture here, we don’t purport to work either within or outside a precise definition of culture that comes from any particular academic body of thought. Rather, we consider particular elements of the social institutions, customs, and attitudes in US society that a layperson might reasonably consider to be culture.

The eight articles we’ve assembled here were written by highly regarded economists and psychologists. Each article considers a specific societal factor that research has shown to be important to economic and social outcomes: religious institutions; parenting practices; family structure; role models, mentors and media influences; peer and family effects; social capital and networks; beliefs about opportunity and mobility; and discrimination. All the authors have written through the lens of objectivity, with a deep and expansive knowledge of the relevant research.

Most people would probably place some of the topics covered here at the top of their list of what they consider cultural elements—for example, the role of religion or family structure. But other topics may seem less obviously “cultural.” For instance, economists often talk about labor market networks without explicitly referring to networks as part of a society’s culture. Nor do most economic considerations of discrimination explicitly consider that practice as a cultural construct. As co-editors, we view each article in this issue as exploring a critical element of the US cultural context shaping children’s lives, though the individual authors don’t necessarily define or discuss the factors they’re writing about explicitly in terms of culture.

Cultural Factors and Social Mobility

Our nation is in the grip of widening inequality and social fragmentation. The past four decades have seen massive increases in income for those at the top of the income distribution but only small to modest increases for those near the bottom. People who lack high levels of skills and education have seen their wages stagnate or fall and their economic insecurity rise. It’s harder today for children to achieve higher levels of income than their parents had, which suggests that the fabled American Dream is under threat.¹ Many of us worry that the promise of opportunity and upward mobility is eroding. The issue of social mobility is front and center in academic research and domestic policy discussions.

Rates of social mobility vary widely from place to place, and many key correlates of upward mobility have to do with the elements of a place’s culture. Groundbreaking research from the Opportunity Insights project—a social science research lab at Harvard University, led by economists Raj Chetty, John Friedman, and Nathaniel Hendren, which makes use of confidential access to millions of US tax records—has provided a rich description of social mobility across localities in the United States.² This data-driven work reveals vast differences across the country in rates of upward mobility for children from low-income homes. Strikingly, the research shows that many of the factors that predict upward mobility...