Estimating racial differences in income dynamics from aggregate data

AGGREGATE DATA ARE USED TO DERIVE TRANSITION PROBABILITY MATRICES FOR BOTH BLACK AND WHITE FAMILIES. THESE DESCRIBE THE PROBABILITY THAT A FAMILY IN ONE INCOME CLASS WILL MOVE TO ANOTHER IN A SINGLE YEAR. THE AVERAGE TIME FOR A FAMILY TO MOVE FROM ONE INCOME CLASS TO ANTOHER IS THEN CALCULATED FROM...

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Bibliographic Details
Published in:Applied economics 1972-09, Vol.4 (3), p.221-234
Main Author: Horowitz, Ann R.
Format: Article
Language:English
Subjects:
Aggregate
Estimates
Income distribution
Minority & ethnic groups
Races
Statistical analysis
Studies
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Summary:AGGREGATE DATA ARE USED TO DERIVE TRANSITION PROBABILITY MATRICES FOR BOTH BLACK AND WHITE FAMILIES. THESE DESCRIBE THE PROBABILITY THAT A FAMILY IN ONE INCOME CLASS WILL MOVE TO ANOTHER IN A SINGLE YEAR. THE AVERAGE TIME FOR A FAMILY TO MOVE FROM ONE INCOME CLASS TO ANTOHER IS THEN CALCULATED FROM THE PROBABILITY ESTIMATES. IN ADDITION TO HAVING A GREATER PROPORTION OF FAMILIES IN THE LOWEST INCOME CLASSES, BLACKS HAVE A RELATIVE DISADVANTAGE IN THEIR CHANCES OF ADVANCING TO A HIGHER INCOME CLASS. RESULTS SHOW THE PROPORTION OF FAMILIES AT THE POVERTY LEVEL IS STEADILY DECLINING, ALTHOUGH THE AVERAGE BLACK FAMILY WITH INCOME BELOW 3000 DOLLARS CAN EXPECT TO SPEND 21 YEARS AT THIS LEVEL BEFORE RISING TO A HIGHER LEVEL. PLAUSIBLE ESTIMATES CAN BE OBTAINED FROM AGGREGATE DATA WHICH ARE MORE READILY AVAILABLE AND COMPREHENSIVE THAN THE TIME-ORDERED DATA FROM THE SOCIAL-SECURITY ADMINISTRATION.
ISSN:0003-6846
1466-4283
DOI:10.1080/00036847200000018