The Curve That Became Poker Straight

Inequality and social mobility are the Laurel and Hardy of economic theory; they are two entirely different things that seem to be inseparable.

The concept is not least important in the most economically unequal countries: One often motivates the other. In other words, it doesn’t really matter if resources are unevenly distributed as long as everyone has a chance of helping themselves.

This idea received a painful shot in the foot the other week when Alan Krueger, one of Obama’s economic advisers, presented a diagram that showed that economic equality and social mobility go hand in hand.

The findings have been attested from several directions in the academic world. It shows quite simply that the most egalitarian countries — in essence, the Nordic nations — are also those which have the greatest social mobility by far. The most unequal country, the U.S., has the least social mobility. And the numbers correlate in an almost uncanny way. The curve is poker straight.

What does Krueger call the diagram? “The Great Gatsby Curve.” Clearly, one must go to literature to find a name for something so enlightening.