A recent analysis by psychologists at the Upshot evaluated people’s ability to measure their shot at income mobility and found that levels of optimism don’t match reality. They see that as a problem.
“Taken together, these sets of studies suggest that belief in the American dream is woefully misguided when compared with objective reality. Addressing the rising economic gap between rich and poor in society, it seems, will require us to contend not only with economic and political issues, but also with biases of our psychology.”
But I have a problem with the fact that they have a problem with that.
America Was Born from Improbability
For all intents and purposes, the United States is built upon a very improbable action: we should never have stood a chance against the British military standing alone. The colonists had to use a combination of brawn and intellect (including alliances) to succeed. So optimism in the face of stacked odds is a part of our national heritage.
Whose Mobility are you Measuring?
Then there is always the question of how you measure mobility and what group we are talking about. The metrics can be quite different. For example, Chetty, et al, found that intra-group mobility is actually quite high, while inter-group mobility of income is lower along racial and other lines.
Then there are the other demographic variables to consider. People know their own background and tend to gauge the positives they have on their side. They may have grown up poor, but they also may have been raised in a mixed income neighborhood. They might not have been at the top of their class, but they have entrepreneurial skills, which are increasingly becoming methods of making money in the Millennial generation.
It may not be “bias” at all that influences into their predictions, but an understanding that there are strong deviations from the mean, and you cannot possibly control for all omitted variables that play into success. In fact, we can’t even settle on a way to measure many of them, like social capital.
What’s Wrong with Overestimating?
The article adds a few key points: “Studies by Professor Gilovich and Mr. Davidai found that members of ethnic minority groups tended to overestimate upward mobility more than did European Americans. This result indicated that those with the most to gain from believing in an upwardly mobile society tended to believe so more strongly.”
But our ‘psychological biases’ may actually be motivational mechanisms. Overestimating the amount of social mobility in the US acts to bring extraordinary success into the purview of those who desperately desire and need mobility. It acts as a spark. It is the realm of “dreams.” To call the “American Dream” at odds with reality is almost tautological: a dream is by definition something that has not come to fruition–yet.
We do no one any good by telling them “You overestimate your ability to succeed and move up the economic ladder.” In fact, you can severely damage what would have been a valiant attempt at upward mobility (one that would have been successful on the margin).
Because as psychologists, the authors should be WELL aware that human beings are fantastic at making excuses and getting down when things don’t go well.
So if it’s inappropriate optimism, I will take that over the psychological tendency to take the easy route. In fact, more harm than good is done by telling someone the likelihood success is low, when they may already be set on a track in which the likelihood of success is higher!
Armchair Consilium 