What Gives Kids a Chance at a More Successful Future? New Study Explains

>>> FOR MANY PARENTS, IT'S THEIR DREAM TO GIVE THEIR CHILDREN A BETTER LIFE THAN THEY WERE GIVEN.

NOW HISTORICALLY IN AMERICA, RACE HAS PLAYED A HUGE PART IN THIS.

RAJ CHETTY OF HARVARD IS FINDING THAT THE RACIAL GAP IS CLOSING.

HERE HE TELLS HARI SREENIVASAN HOW THIS WAS ACHIEVED AND WHAT DETERMINES OUR CHILDREN'S FUTURES TODAY.

>> BIANNA, THANKS.

RAJ CHETTY, THANK YOU SO MUCH FOR JOINING US.

YOU RUN OPPORTUNITY IN SIGHTS AT HARVARD WHICH TAKES A LOOK AT A LOT OF STUFF.

REALLY THE MOST FASCINATING STUFF IS THE RESEARCH YOU'VE DONE ON SOCIAL MOBILITY OVER THE DECADES AND WHERE IS THE DATA ON HOW PEOPLE GET A LEG UP IN AMERICA.

YOU HAD A RECENT REPORT OUT LOOKING AT KIDS, AND WHAT THE BEST PREDICTORS OF SOCIAL MOBILITY AND OUTCOMES WERE.

WALK US A LITTLE BIT THROUGH YOUR FINDINGS.

>> YEAH, HAHARI, GREAT TO BE WI YOU AGAIN.

BASICALLY, WHO GETS TO ACHIEVE THE AMERICAN DREAM OF RISING UP.

I THINK ONE OF THE CORNERSTONE IDEALS OF THIS COUNTRY, NO MATTER WHERE YOU COME FROM, NO MATTER THE COLOR OF YOUR SKIN, NO MATTER YOUR BACKGROUND.

AND WE'VE BEEN STUDYING THOSE ISSUES USING BIG DATA, DATA DRAWN FROM ANONYMIZED TAX RETURNS COVERING ALL AMERICANS, MILLIONS OF KIDS AND THEIR PARENTS FOR OVER A DECADE NOW.

AND A DECADE AGO WE PUT OUT A STUDY CALLED THE LAND OF OPPORTUNITY, BASICALLY TRYING TO FIGURE OUT WHERE THE AMERICAN DREAM WAS ALIVE AND WHO HAD THE BEST CHANCES OF RISING UP.

AND IN THIS MOST RECENT STUDY THAT WE PUT OUT A WEEK AGO, WE'VE NOW UPDATED THAT DATA TO LOOK AT HOW ECONOMIC OPPORTUNITY, UPWARD MOBILITY IS CHANGING BY RACE AND CLASS IN THE UNITED STATES.

AND THE HEADLINE FINDINGS ARE THAT THE LANDSCAPE OF OPPORTUNITY IS CHANGING QUITE A BIT IN AMERICA, IN PARTICULAR, RACIAL GAPS IN ECONOMIC OPPORTUNITY BETWEEN BLACK AND WHITE AMERICANS ARE NARROWING SOMEWHAT.

SO IT USED TO BE THE CASE, AND IT STILL REMAINS THE CASE TO A LARGER EXTENT THAT WHITE KIDS GROWING UP IN LOW-INCOME FAMILIES HAVE MUCH BETTER CHANCES OF RISING UP AND ACHIEVING THE AMERICAN DREAM THAN BLACK KIDS.

BUT THAT ADVANTAGE, WHICH WAS EXTREMELY LARGE IF YOU LOOK AT KIDS BORN BACK, SAY, IN THE LATE 1970s AROUND WHEN I WAS BORN, THAT ADVANTAGE HAS SHRUNK BY ABOUT A THIRD, HARI, IN THE PAST 15 YEARS.

AND A 1/3 CHANGE, THAT DOESN'T MEAN WE HAVE PERFECT EQUITY BY RACE BY ANY MEANS, BUT THAT'S QUITE A SUBSTANTIAL CHANGE OVER A 15-YEAR PERIOD.

SO THAT'S ONE KEY ASPECT OF WHAT HAS HAPPENED.

SHRINKING RACE GAPS.

ON THE OTHER SIDE, WE FIND THAT CLASS GAPS ARE GROWING.

AND BY THAT I MEAN PARENT INCOME IS A MORE AN MORE DETERMINANT OF HOW WELL YOU'LL DO IN AMERICA.

THE DIVIDE BETWEEN KIDS GROWING UP IN RICH FAMILIES AND POOR FAMILIES, ESPECIALLY AMONG WHITE CHILDREN IS GROWING BY ABOUT A THIRD OVER THE PAST 15 YEARS.

AND SO THE HEADLINE FINDINGS FROM THESE NEW DATA COVERING 57 MILLION KIDS ARE A STORY OF SHRINKING RACE GAPS AND GROWING CLASS GAPS IN ECONOMIC MOBILITY.

>> WHAT DO YOU THINK IS THE LARGEST SET OF FACTORS IN SHRINKING THE RACE GAP?

PEOPLE ARE GOING TO WANT TO ASCRIBE THEIR OWN POLITICAL INTERESTS ON TO OH, IT'S BECAUSE OF THIS POLICY OR THAT POLICY.

BUT WHAT HAS BEEN WORKING?

>> I THINK THAT'S A COMPLICATED QUESTION.

WE INVESTIGATED MANY DIFFERENT FACTORS THAT MIGHT BE CAUSING THIS.

LET ME FIRST SAY AS A STARTING POINT, WHAT IS DRIVING THAT SHRINKING OF THE RACE GAP.

HALF IS DRIVEN BY BLACK KIDS GROWING UP IN LOW-INCOME FAMILIES DOING BETTER THAN THEY WERE BEFORE.

THEY'RE MORE LIKELY TO RISE OUT OF POVERTY, LESS LIKELY TO BE UNEMPLOYED, LESS LIKELY TO BE INCARCERATED.

POSITIVE PROGRESS FOR BLACK KIDS GROWING UP IN LOW-INCOME FAMILIES, WHICH I THINK WE SHOULD CELEBRATE.

ON THE OTHER SIDE, WE HAVE WHITE KIDS GROWING UP IN LOW-INCOME FAMILIES UNFORTUNATELY DOING A BIT WORST THAN THEY HAVE IN THE PAST, LESS LIKELY TO BE WORKING, LESS LIKELY TO BE IN THE MIDDLE CLASS AND SO ON.

SO THE SHRINKING OF THE GAP IS FROM BLACK KIDS DOING BETTER AND LOW INCOME WHITE KIDS NOT DOING AS WELL.

NOW WHAT IS DRIVING THOSE TRENDS?

IT TURNS OUT THAT A LOT OF THE EXPLANATION ORIGINATES IN THE COMMUNITIES IN WHICH THESE KIDS ARE GROWING UP.

BLACK KIDS ARE INCREASINGLY GROWING UP IN THRIVING COMMUNITIES WHERE YOU HAVE MORE PARENTS WHO ARE WORKING, HIGHER LEVELS OF STABILITY, MORE OPPORTUNITIES TO RISE UP, MORE EXPOSURE TO PEOPLE WHO CAN CONNECT YOU TO AN INTERNSHIP OR A PATHWAY TO SUCCESS.

WHITE KIDS, PARTICULARLY WHITE KIDS WITH LESS EDUCATED PARENTS UNFORTUNATELY ARE GROWING UP IN COMMUNITIES THAT ARE NOT THRIVING AS MUCH.

AND THAT'S DRIVING THE DECLINE IN ECONOMIC MOBILITY FOR WHITE CHILDREN.

>> SO EVEN WHEN YOU LOOK EITHER AT RACE OR AT CLASS, IS THIS A ZERO SUM?

THIS DOESN'T SEEM LIKE IT'S ONE COMMUNITY GETTING BETTER WHEN THE OTHER GETS WORSE OR VICE VERSA.

>> THAT'S EXACTLY RIGHT.

AND I THINK THAT'S AN EXTREMELY IMPORTANT POINT.

WE FIND THAT IN THE PLACES WHERE BLACK KIDS ARE DOING BEST, AND YOU CAN LOOK AT THIS DATA -- IN FACT, THE AUDIENCE CAN LOOK IT UP IN THEIR OWN COMMUNITY IF YOU GO TO THE WEBSITE CALLED THE OPPORTUNITY ATLAS, YOU CAN LOOK UPDATE THAT FOR YOUR OWN COUNTY.

WHAT YOU'LL SEE IS THERE ARE SOME PARTS OF AMERICA LIKE PARTS OF THE SOUTHEAST, A CITY LIKE CHARLOTTE, NORTH CAROLINA, FOR EXAMPLE, WHERE BLACK KIDS ARE DOING MUCH BETTER THAN THEY WERE BEFORE.

BUT THOSE SAME PLACES WHERE WE SEE BLACK KIDS DOING BETTER, WE ALSO SEE WHITE KIDS DOING RELATIVELY BETTER.

SO IT'S ABSOLUTELY NOT A ZERO SUM GAME.

IT'S NOT THAT ONE GROUP IS BENEFITTING AT THE EXPENSE OF THE OTHER.

BOTH GROUPS ARE DOING IN SOME PLACES, AND WORSE IN OTHER PLACES.

AND SO, YOU KNOW, I THINK WHAT THIS SHOWS US IS THE ECONOMIC MOBILITY IS REALLY SOMETHING WE CAN ALL BENEFIT FROM AND MAKE PROGRESS TOGETHER.

>> YOU MENTIONED CHARLOTTE, NORTH CAROLINA.

THAT WAS THE PLACE TEN YEARS AGO WHEN YOUR REPORT DID NOT FARE TOO WELL.

HOW WERE YOU ABLE TO LOOK AT THAT DATA OVER THIS TIME?

ARE THEY IMPROVING?

HOW SO, AND WHO ARE THEY COMPARED TO?

>> YES, SO CHARLOTTE IS A VERY INTERESTING CASE.

WHEN WE PUT OUT THE DATA I MENTIONED EARLIER, 2014, WE RANKED THE LARGEST CITIES IN AMERICA.

CHARLOTTE RANKED 50th OUT OF THE 50 LARGEST CITIES.

IT WAS THE LOWEST IN TERMS OF CHANCES OF RISING UP IF YOU WERE A POOR KID GROWING UP THERE.

NOW THAT SHOCKED AND SURPRISED IN PEOPLE IN CHARLOTTE BECAUSE MANY PEOPLE VIEW CHARLOTTE AS A VIBRANT CITY, WHICH IT ABSOLUTELY IS.

IF YOU DRIVE AROUND CHARLOTTE TODAY, RELATIVE TO 20 OR 30 YEARS AGO, YOU'D SEE THAT THERE ARE MANY MORE TALL TOWERS AND PROSPERING BUSINESSES, AND PEOPLE ARE DOING WELL.

BUT IT TURNS OUT WHEN YOU TAKE A DEEPER LOOK AT THE DATA AND YOU FOLLOW KIDS OVER TIME USING TAX RECORDS GROWING UP IN CHARLOTTE, PARTICULARLY KIDS BORN IN THE LATE 1970s, EARLY 1980s, IF YOU WERE GROWING UP IN A LOW-INCOME FAMILY, YOU WERE NOT BENEFITTING FROM THAT PROSPERITY.

YOU WERE NOT GETTING JOBS AT FIRMS LIKE BANK OF AMERICA, A HIGH-PAYING FINANCIAL COMPANY HEADQUARTERED IN CHARLOTTE.

NOW WHEN WE PUT OUT THAT STUDY, FOLKS IN CHARLOTTE RESPONDED IN A REALLY CONSTRUCTIVE WAY.

THEY SAID THIS IS NOT SOMETHING WE WANT, THE LABEL 50 OUT OF 50.

WE BELIEVE IN PROSPERITY FOR EVERYONE.

WHAT CAN WE DO TO TRY TO MAKE A CHANGE?

THERE WERE MANY INITIATIVES LAUNCHED, A TASK FORCE, MORE THAN $200 MILLION SPENT BY NONPROFITS TO TRY TO IMPLEMENT MENTORING PROGRAMS, OTHER KINDS OF INVESTMENTS IN THE CITY EARLY CHILDHOOD EDUCATION TO TRY TO GIVE KIDS BETTER ACCESS TO JOBS AT FIRMS LIKE BANK OF AMERICA.

AND WHAT WE SEE NOW WHEN WE LOOK AT THE NEW DATA, WE CAN'T ASCRIBE IT DIRECTLY TO THOSE EFFORTS, BUT NOR GENERALLY, IT'S ACTUALLY A VERY POSITIVE STORY FOR CHARLOTTE NOW RANKS AMONG THE MOST IMPROVE STIDS IN TERMS OF ECONOMIC MOBILITY IN THE PAST 15 YEARS, AT THE TOP OF THE LIST.

IT'S NOT OVERALL THE BEST PLACE IN TERMS OF RISING UP, BUT IT'S NO LONGER 50th OUT OF 50.

IT'S SOMETHING LIKE 38th OUT OF 50.

IT'S ON A VERY POSITIVE TRAJECTORY.

LET MECON TRAST THAT, HARI WITH ATLANTA WHICH RANKED 49th OUT OF 50 ON OUR LIST AND NOW RANKS 50 OUT OF 50.

IN ATLANTA, THERE HAS BEEN NO PROGRESS IN TERMS OF ECONOMIC MOBILITY.

SO THAT SHOWS THERE IS NO GUARANTEE HERE THAT THINGS ARE GOING TO GET BETTER.

WE HAVE TO TAKE A DELIBERATE APPROACH TO IMPROVING THINGS.

BUT IT ALSO SHOWS I THINK ENCOURAGING THAT CHANGE IS POSSIBLE, AND WE CAN MAKE THE AMERICAN DREAM A REALITY FOR EVERYONE.

>> LOOK, SOMEONE MIGHT LOOK AT THE KIND OF HEADLINES FROM YOUR STUDY AND SAY WELL, THIS IS JUST ABOUT MONEY.

IS CLASS A DIFFERENT WAY TO SAY A WEALTHY OR AFFLUENT COMMUNITY?

ARE THERE PLACES WHERE YOU CAN POINT TO A CITY THAT MIGHT NOT BE THE RICHEST OR THE NEIGHBORHOOD THAT MIGHT NOT BE THE RICHEST, BUT WHERE KIDS ARE STILL GETTING THESE BETTER OUTCOMES BECAUSE OF THE COMMUNITY OF SUPPORT THAT THEY HAVE AND THE ACCESS TO INTERNSHIPS OR WHOSE PARENTS ARE WORKING.

>> THAT'S EXACTLY RIGHT, HARI.

NO DOUBT MONEY MATTERS.

KIDS WHO GROW UP IN HIGHER INCOME FAMILIES DO BETTER ON MANY DIMENSION, NOT JUST IN TERMS OF HOW MUCH MONEY THEY MAKE THEMSELVES, BUT THEIR HEALTH, THE EDUCATION THEY GET, NUMEROUS DIFFERENT LIE OUTCOMES THAT WE MIGHT ALL CARE ABOUT.

BUT AS YOU'RE STRESSING, AND I THINK THIS IS A KEY MESSAGE FROM THE DATA, WHAT MATTERS REALLY ABOVE AND BEYOND THAT IS THE STRENGTH OF THE COMMUNITY IN WHICH YOU'RE GROWING UP.

EVEN HOLDING FIXED INCOME.

TAKE DUBUQUE IOWA, OR MUCH OF RURAL IOWA.

YOU WOULDN'T THINK OF RURAL IOWA AS A POWERHOUSE IN TERMS OF HIGH-PAYING JOBS AND SO ON.

IT TURNS OUT IF YOU WANT TO PICK A PLACE TO RISE UP AND ACHIEVE THE AMERICAN DREAM, THAT'S THE SORT OF PLACE WHERE YOUR ODDS ARE THE BEST.

YOU HAVE THE BEST CHANCES OF RISING UP IN MANY PLACES IN THE RURAL MIDWEST, NOT BECAUSE YOU'RE GOING TO GET THAT HIGH-PAYING JOB OR FIND SUCCESS IN THAT COMMUNITY ITSELF, BUT WE SEE THAT THOSE COMMUNITIES OFTEN HAVE A LOT OF CONNECTIONS BETWEEN LOW AND HIGH INCOME PEOPLE, PEOPLE WHO HELP YOU OUT, SHOW YOU A PATH HAVE, GREAT EDUCATIONAL SYSTEMS AND SO ON, THEY LAUNCH KIDS ON CAREERS THAT THEN LEAD THEM TO HIGH-PAYING POSITIONS IN A PLACE LIKE CHICAGO OR NEW YORK, FIND SUCCESS IN VARIOUS DOME NANES AND SO ON.

SO THAT COMMUNITY UNIT IS REALLY CRUCIAL WE THINK FOR RESTORING THE AMERICAN DREAM.

>> SINCE YOU HAVE THIS LARGE SNAPSHOT, AND YOU CAN EVEN ZOOM DOWN ALMOST INTO THE ZIP CODE LEVEL HERE, I WONDER WHAT IS IT THAT IS DRIVING THE LESS POSITIVE OR MORE NEGATIVE OUTCOMES FOR WHITE CHILDREN.

BY YOUR DATA, IT WOULD SHOW THAT SOMETHING IS HAPPENING TO THOSE COMMUNITIES, THAT THERE IS LESS ECONOMIC OPPORTUNITY FOR THE PARENTS OF YOUR FRIENDS TO HAVE JOBS, IF I'M READING THAT RIGHT.

>> THAT'S EXACTLY RIGHT.

AND IF WE JUST THINK ABOUT THE HISTORY OF THE U.S. AND A LOT OF WHAT WE HEAR IN THE PUBLIC DISCOURSE, THERE HAVE BEEN MANY CHANGES IN TERMS OF GLOBAL COMPETITION, OUTSOURCING TECHNOLOGICAL CHANGE, WHERE LOTS OF FOLKS HAVE LOST JOBS.

THE LOCAL STEEL PLANT, THE AUTO INDUSTRY DECLINES IN CERTAIN PLACES.

AND MANY WORKERS, AND IT'S OFTEN BEEN WHITE WORKERS WHO HAD THOSE HIGH-PAYING JOBS, THEY ENDED UP LOSING EMPLOYMENT.

AND WE'VE SEEN IN EARLIER WORK THAT THEY HAVEN'T NECESSARILY COME BACK THE WORK AND HAVEN'T FOUND JOBS.

NOW WHAT WE'RE SEEING IN THESE NEW DATA IS THAT HAS AN IMPACT NOT JUST ON THAT GENERATION OF WORKERS WHO WERE DISPLACED, BUT ON THE NEXT GENERATION OF KIDS, IN PARTICULAR WHITE KIDS WHO ARE GROWING UP IN THESE COMMUNITIES WHERE NOW YOU KNEW MANY PEOPLE WHO WORKED AT THE LOCAL STEEL PLANT OR AUTO PLANT AND KIND OF HAD THAT HALFWAY PLANNED OUT AND HAD A SENSE OF HOW YOU MIGHT FOLLOW THAT TRACK, THAT OPTION IS NO LONGER AVAILABLE.

YOU MIGHT HAVE THOUGHT PEOPLE WILL NATURALLY GO IN SOME DIFFERENT DIRECTION.

BUT THAT'S NOT HAPPENING.

UNFORTUNATELY, WE'RE SEEING A DECLINE IN THOSE COMMUNITIES WHERE THERE ARE HEALTH ISSUES THAT EMERGE, PEOPLE GET MORE DISCONNECTED, NOT GRADUATING FROM HIGH SCHOOL, A BROADER DECLINE THAT IS LEADING TO THIS DECLINE IN ECONOMIC MOBILITY UNFORTUNATELY FOR MANY WHITE AMERICANS.

>> WE'RE ALL GOING TO SEE FOR THE NEXT COUPLE OF MONTHS HARRIS AND WALZ AND TRUMP AND VANCE GO OUT ON STUMP SPEECHES AFTER STUMP SPEECHES AND TRYING TO REACH THESE PEOPLE WHO FEEL LIKE THAT THE ECONOMY HAS LEFT THEM BEHIND, RIGHT.

AND I WONDER IF YOU WERE TO BE ABLE TO ADVISE BOTH OF THESE CAMPAIGNS ECONOMIC POLICY ADVISERS, WHAT WOULD THE SUGGESTIONS BE?

HOW DO WE CRAFT POLICIES THAT TARGET NOT JUST INDIVIDUALS, BUT ENTIRE COMMUNITIES?

>> YEAH, IT'S A GREAT QUESTION.

MY VIEW IS THESE ARE ISSUES OF DECLINING ECONOMIC OPPORTUNITY ARE ABSOLUTELY CENTRAL TO WHAT WE'RE HEARING IN THE PUBLIC DEBATE AND THE CAMPAIGNS AND SO ON.

AND THE QUESTION, OF COURSE, IS WHAT WE TCAN DO TO ADDRESS THES ISSUES GOING FORWARD BOTH FOR THE COMMUNITIES THAT ARE DECLINING AND TO INCREASE FOR BLACK AMERICANS WHO ARE MAKING SOME PROGRESS, BUT STILL HAVE A LONG WAY TO GO IN TERMS OF THEIR CHANCES OF RISING UP.

MY SENSE IS WHILE THERE IS NO SILVER BULLET, I THINK THERE HAS BEEN AN EXCESS FOCUS AND ECONOMIC POLICY ON THINGS LIKE FINANCIAL CAPITAL, GIVING PEOPLE MONEY OR SIMPLY GIVING PEOPLE EDUCATION, THOSE THINGS MATTER NO DOUBT.

BUT WE'RE SEEING WITH THE NEW DATA AND OTHER RELATED RESEARCH IS THAT SOCIAL CAPITAL MATTERS AS WELL IN ADDITION TO FINANCIAL CAPITAL AND EDUCATION INVESTMENTS.

SO WHAT DO I MEAN BY THAT?

WHAT I MEAN IS THAT WHO YOU'RE CONNECTED TO, WHO YOU'RE INSPIRED BY, WHAT YOUR NETWORKS LOOK LIKE, THE SOCIAL INFRASTRUCTURE OF SOCIETY SEEMS TO BE EXTREMELY IMPORTANT IN ADDITION TO THE BREAD AND BUTTER HOW MANY DOLLARS DO YOU HAVE, WHAT SCHOOLS DO YOU HAVE ACCESS TO AND SO ON.

AND OFTEN WHAT WE'RE SEEING, HARI, IS THE PROGRAMS THAT ARE MOST EFFECTIVE IN A WIDE VARIETY OF DOMAINS FROM AFFORDABLE HOUSING POLICY TO JOB TRAINING PROGRAMS, THEIR EDUCATIONAL POLICIES, THE INTERVENTIONS THAT ARE MOST EFFECTIVE PREPARE GIVING PEOPLE RESOURCES WITH SOCIAL SUPPORT TO USE THOSE RESOURCES MORE EFFECTIVELY.

LET ME GIVE YOU A CONCRETE EXAMPLE.

TAKE THE HOUSING VOUCHER PROGRAM ON WHICH WE SPEND MORE THAN $20 BILLION A YEAR IN THE U.S., GIVING FAMILIES RENTAL ASSISTANCE THAT IS INTENDED TO HELP THEM MOVE TO HIGHER OPPORTUNITY NEIGHBORHOODS.

FAMILIES GET THIS MONEY OFTEN WORTH $1500 A MONTH IN MANY PLACES.

NOT A SMALL SUM.

BUT THEY DON'T END UP USING THAT MONEY TO ACTUALLY MOVE TO BETTER NEIGHBORHOODS, BETTER ZIP CODES.

WHAT WE SEE IN OUR DATA, THEIR KIDS ARE MORE LIKELY TO BREAK THE CYCLE OF POVERTY.

SO WHAT WE'VE DONE IS IN THAT CONTEXT, AN INTERVENTION IN SEATTLE WHERE WE ESSENTIALLY PROVIDED SOCIAL SUPPORT TO FAMILIES, CONNECTED THEM WITH A COUNSELOR WHO FOUND HOUSING FOR THEM AND HIGHER OPPORTUNITY OPPORTUNITIES IF THEY WANTED TO MOVE THERE.

NEGOTIATED WITH THEM WITH LANDLORDS ON THEIR BEHALF.

BASICALLY, HELPED THEM THROUGH THE HOUSING SEARCH PROCESS.

AND THAT RELATIVELY INEXPENSIVE INTERVENTION DRAMATICALLY CHANGED THE FRACTION OF FAMILIES WHO MOVED TO HIGH OPPORTUNITY AREAS FROM 15% IN THE CONTROL GROUP, THIS WAS RUN AS A RANDOMIZED EXPERIMENT, TO 60% IN THE TREATMENT GROUP.

BASICALLY MAKING THE BILLIONS OF DOLLARS WE'RE ALREADY SPENDING FAR MORE EFFECTIVE IN TERMS OF HELPING KIDS RISE OUT OF POVERTY.

WE ESTIMATE THAT TWEAK TO THE PROGRAM WILL HELP KIDS OVER THEIR LIFETIMES EARN ABOUT $200,000 MORE BECAUSE THEY'RE NOW GOING TO BETTER SCHOOLS, GROWING UP IN MORE THRIVING COMMUNITIES AND SO ON.

SO THAT'S JUST ONE SMALL EXAMPLE.

THAT THEME I THINK OF USING THE RESOURCES WE'RE ALREADY SPENDING IN TANDEM WITH THE SOCIAL CAPITAL SORT OF INTERVENTION CAN BE APPLIED IN MANY DIFFERENT SETTINGS AND I THINK CAN MAKE OUR COUNTRY MUCH MORE EFFECTIVE IN HELPING PEOPLE RISE UP.

>> WHAT DO WE DO WITH ALL OF THE AREAS IN AMERICA THAT LACK THE SOCIAL CAPITAL TODAY WHETHER THEY'VE BEEN MARGINALIZED ALREADY, WHETHER THEY'RE ALREADY IMPOVERISHED ECONOMICALLY, WHETHER WHERE THERE ISN'T THAT ACCESS TO SOMEONE'S PARENTS WHO MIGHT HAVE A CONNECTION TO A JOB THAT THEY COULD WORK AT.

>> YEAH, ABSOLUTELY.

I'VE BEEN GIVING MOVING OPPORTUNITY, BRINGING PEOPLE TO OPPORTUNITY.

THAT CAN BE PART OF THE SOLUTION.

BUT OBVIOUSLY, IT'S NOT COMPLETELY SCALEABLE.

WHAT WE REALLY NEED TO DO IS BRING OPPORTUNITY TO PEOPLE WHERE THEY CURRENTLY LIVE IN PLACES WHERE IT'S LACKING.

AND SO THERE ARE MANY DIFFERENT STRATEGIES ONE CAN TAKE.

LET ME GIVE YOU ANOTHER CONCRETE EXAMPLE.

I THINK THERE IS A NEW SET OF JOB TRAINING PROGRAMS THAT CAN CONNECT PEOPLE TO OPPORTUNITIES AND HAVE SHOWN TREMENDOUS SUCCESS IN RANDOMIZED TRIALS THAT AGAIN COMBINE TRADITIONAL SKILLS TRAINING, TEACHING PEOPLE I.T.

OR SOME OTHER SKILL THAT'S IN DEMAND, BUT NOW COMBINING THAT WITH SUPPORT FROM A NETWORK.

SO I'M THINKING OF PROGRAMS LIKE GEAR UP.

WHAT THEY DO IS BRING YOU IN FOR SOMETHING LIKE A ONE-YEAR INTERNSHIP, AND THEY SAY LOOK, BANK OF AMERICA IS LOOKING TO HIRE A THOUSAND PEOPLE.

THIS ACTUALLY HAPPENED COMING BACK TO CHARLOTTE WHEN WE HAD OUR STUDY.

BANK OF AMERICA MADE A COMMITMENT TO HIRE A THOUSAND KIDS FROM DISADVANTAGED BACKGROUNDS WHO GREW UP IN CHARLOTTE ITSELF.

SO THE WAY THEY DID THAT IS THEY TEAMED UP WITH THIS GROUP YEAR UP IN A LOCAL COMMUNITY COLLEGE TO SAY WE WANT TO HIRE PEOPLE WHO CAN FILL THESE SPECIFIC JOBS.

LET'S PROVIDE THEM THE TRAINING THEY NEED TO BE ABLE TO GET THOSE JOBS, BUT ALSO TELL THEM THAT THERE IS AN INTERNSHIP WAITING FOR THEM, PROVIDE THEM THE WRAPAROUND SOCIAL SUPPORT NEEDED TO BE ABLE TO SUCCEED IN THESE CAREERS AND SO ON.

AND IT TURNS OUT IF YOU DO A RANDOMIZED TRIAL, FLIP OF THE COIN, SOME PEOPLE GET ACCESS TO THIS PROGRAM, SOME DON'T.

THOSE WHO GET ACCESS TO IT, WE SEE A 40% EARNINGS GAIN SUSTAINED OVER MANY, MANY YEARS.

AND ARE NOW BECAUSE OF THAT SOCIAL CONTACT ON A TRAJECTORY WHERE THEY'RE PROVIDING FOR THEMSELVES, PROVIDING FOR THEIR FAMILIES.

THAT'S, AGAIN, ONE CONCRETE EXAMPLE OF THINGS WE CAN DO IN COMMUNITIES WHERE OPPORTUNITY IS CURRENTLY LACKING.

>> ALL RIGHT.

RAJ CHETTY, PROFESSOR OF ECONOMICS AT HARVARD AND DIRECTOR OF OPPORTUNITY INSIGHTS, THANK YOU SO MUCH FOR JOINING US.

>> THANK YOU, HARI.

MY PLEASURE.