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World Bank Says Chances of Upward Social Mobility in India About the Same as in the US

While that's great news for India, saying that a nation has the same class mobility as the US doesn't mean what it used to.
January 22, 2015, 8:08pm

A tent city in Hyderabad, India. Photo via Flickr user Dave Wilson

Ah, America. Land of opportunity. Take a deep breath and smell the possibilities. As Obama said in his State of the Union address on Tuesday, "a nation that gave someone like me a chance." A nation that allowed a wide-eyed kid from Hawaii and member of the Choom gang to become its president. But are the chances of upward mobility in America all that great? In a new report released on Tuesday, hours before Obama's remarks, the World Bank claimed that it is now about as easy to move out of poverty or from low-class to middle-class status in India as it is in America.

Entitled "Addressing Inequality in South Asia," the report notes that (based on gini coefficient measures of income distribution and inequality) between 2004 and 2010, roughly 40 percent of India's poor (or 9 percent of the total population) moved above the poverty line, with 11 percent moving into the middle class. The authors revel in the fact that, especially for historically socially immobile minorities, the place of one's birth and occupation of one's parents matter far less now than in the history of modern India. It credits this change largely to the abundance of non-farm jobs available in the country's ever-expanding urban spheres.


"There is good news," the study co-author and World Bank Chief Economist for South Asia Martin Rama told The Hindu. "India is no longer the land of extremes and there are some bright spots."

The report plays into some cheery narratives of the nation's newfound and heartening social fluidity, like the story of Prime Minister Narendra Modi's rise from low-class origins as a train station tea server. Yet America, where fears about waning social mobility and inequality dog most major public debates, might not be as phenomenal a marker of India's success as many would like to think.

According to a 2012 Economic Policy Institute study, "U.S. [social] mobility is amongst the lowest of major industrialized economies."

A 2013 Pew study showed that 70 percent of Americans born in the bottom fifth economic percentile never reach a middle percentile, while 17 percent achieve (roughly) middle class status, 9 percent upper-middle class, and 4 percent upper class. These findings were largely corroborated by a 2014 Harvard study, which further showed that movements from working class to wealth have actually fallen. Compared to a nation like Denmark, where up to 16 percent of the nation's poor will move to the top fifth economic percentile in their lives, the US seems like a pretty shitty standard by which to measure a nation's ascendant class mobility.

What's truly depressing from the American perspective is not just what a crap metric we are. It's that the World Bank study, if true, shows that India is kicking our ass by increasingly divorcing one's origins from one's future. Not only do most recent studies on the US suggest that the rate at which Americans escape poverty has been stagnant for decades, they also fairly explicitly show that one's race, parents' social status, or place of birth are still shockingly strong indicators of one's position later in life. And as inequality grows in America, this static class positioning and socio-economic pre-determination becomes all the more worrying.


But the study is not a universal coup for India, or a definitive blow to the American psyche. Many observers do not agree on what constitutes poverty in India, with the government claiming in 2012 that only 22 percent of its citizens fell below the poverty line, but outside auditors claiming a 30 percent poverty rate in 2014. The fact that the new World Bank study focuses on class attainment through income-based measures, but concedes a shocking lack of access throughout the nation to clean water, electricity, medical services, education, and welfare (despite billions of dollars spent yearly by New Delhi on subsidies and social services), especially for marginalized groups, suggests that this success in social mobility is mainly spreadsheet-deep. The McKinsey Global Institute in 2014 claims that, if one were to factor in access to amenities we traditionally associate with life above the poverty line, it would take a 50 percent larger income than the government's projects to escape destitution, leaving 56 percent of the population in privation.

The World Bank study also points out that in the same period as so many supposedly escaped on-paper destitution, 9 percent of Indians also slipped backwards over the poverty line.

While America is far from perfect in our provision of essential goods and social services, it is far more likely that US poverty escapees will have decent access to such vital resources. It's also far less likely to fall backward on the class ladder in America than it appears to be in India.

Congratulations are still certainly in order to India for becoming a regional leader in social mobility. Even if a class shift there might not look as significant as it could, the nation's upward trajectory, especially for marginalized groups, is promising—especially compared to America, where we're just happy not to reverse the stream of social fluidity. But for all its good news, the World Bank report is still a kick in the balls to India that should make it look at how to get its infrastructural and social services together to match its citizens' growing incomes, just as much as it's a sharp reminder to America to consider where we sit in terms of the global scale of class mobility.

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