The Income-Achievement Gap and Adult Outcome Inequality

Abstract

This paper uses scale-independent methods to contribute to the debate about how academic achievement differences between advantaged and disadvantaged youth have changed over time in the United States. Ordinal methods reveal an unambiguous decrease in the reading gap and an ambiguous change in the math gap between youth from high- versus low-income households from 1980 to 1997. Anchoring these test scores to later-life outcomes in the 1980 cohort suggests that these achievement shifts correspond to a convergence of $30,000 - $50,000 in present-value lifetime income and 0.02-0.05 in high school and college completion rates for youth from high- versus low-income households.