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Economics · 06 / 06

Inequality and social mobility

Final-year concepts · Worked example and 4 exercises with solutions, at your pace.

Need a foundation?Indicators: rates, indices, chartsScientific experiments: control and conclusion
UnderstandSee an exampleGuided exercise3 progressive challenges

The principle, simply

Inequality concerns unequal access to valued resources such as income, wealth, education and health. They can accumulate without being identical. Mobility compares social positions using defined classifications and references, often across generations. Separate observed mobility from employment-structure change; read table denominators.

THE PICTURE TO REMEMBERInequality and social mobility
  1. 01Measured resource
  2. 02Population and reference
  3. 03Denominator
  4. 04Mobility and structure

WORKED EXAMPLE

From principle to reasoning

An origin table asks where a category’s members came from; a destination table asks where children of an origin category go. Percentages answer different questions from the same counts.

Solve a problem in this subject

  1. Define the indicator

    Specify quantity, population, period and unit. Distinguish level, change, rate of change and percentage points.

  2. Read or calculate

    Identify denominator and comparison base. From 20% to 25% is +5 percentage points but a 25% relative increase.

  3. Explain a mechanism

    Show steps connecting a proposed cause to its effect. Separate model, assumptions and evidence; correlation alone is insufficient.

  4. Discuss with evidence

    Use a precise example and limitations. Averages conceal distributions; nominal measures include price effects.

YOUR TURN

01 · Try before checking

Why do income and wealth differ?

One hint

Separate period flow from dated stock.

Reveal and understand the solution

Income is a flow over time; wealth is an asset stock, net of debt when defined that way.

Compare method, conditions and answer; identify the exact part to revisit.

IMPROVE THROUGH PRACTICE

Three additional challenges with solutions

Start with the first challenge. Write your method before opening a hint; use the solution to find the first step that needs work.

Reflect after practising
02 · Recognise and understandLink to this exercise

Distinguish income inequality from wealth inequality.

A hint to get started

Income is a flow; wealth is a stock.

Step-by-step solution
  1. Income is measured over a period.
  2. Wealth measures assets, accounting for liabilities under the chosen definition.
  3. Equal incomes can coexist with very different wealth.

Which step did you miss? Retry without help, then explain why the method works.

03 · Apply the methodLink to this exercise

A person becomes a manager while their parent was a clerk. What mobility is this?

A hint to get started

The comparison is between generations.

Step-by-step solution
  1. It is intergenerational mobility.
  2. It is upward under the chosen hierarchy.
  3. Specify categories and conventions before statistical comparisons.

Which step did you miss? Retry without help, then explain why the method works.

04 · Go furtherLink to this exercise

Does greater observed mobility automatically prove equal opportunity improved?

A hint to get started

The occupational structure may also change.

Step-by-step solution
  1. Some mobility reflects structural change.
  2. Relative chances require a different analysis.
  3. Compare origin, destination, sample sizes and methods before concluding.

Which step did you miss? Retry without help, then explain why the method works.

The trap to avoid

Category changes alone do not establish equal opportunities.

Without notes, can you…

  • Explain the principle in your own words?
  • Rebuild the diagram and its connections?
  • Solve the exercise and justify the method?

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