Not the Great Equalizer? Local Economic Mobility and Inequality Effects for the Establishment of U.S. Universities

Author/Creator ORCID

Date

2022-08

Department

Program

Citation of Original Publication

Russell, Lauren C., and Michael J. Andrews. (2022). Not the Great Equalizer? Local Economic Mobility and Inequality Effects for the Establishment of U.S. Universities. (EdWorkingPaper: 22-634). Retrieved from Annenberg Institute at Brown University: https://doi.org/10.26300/1ygg-yc61

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Subjects

Abstract

We exploit historical natural experiments to test whether universities increase economic mobility and equality. We use “runner-up” counties that were strongly considered to become university sites but were not selected for as-good-as-random reasons as counterfactuals for university counties. University establishment causes greater intergenerational income mobility but also increases cross-sectional income inequality. We highlight four findings to explain this seeming paradox: universities hollow out the local labor market and provide greater opportunities to achieve top incomes, both of which increase cross-sectional inequality, and increase educational attainment and connections to high-SES people, which prevent inequality from perpetuating into intergenerational immobility.