Attempts to improve social mobility in Britain throughout the last 150 years have failed to make any material difference, according to new research.
A study tracking 634 rare surnames, such as Pepys, Bigge and Nottidge, has shed new light on how wealth has been handed down since 1850. Researchers studied a variety of sources – including the censuses of 1841–1911, records of births, marriages, probates and baptisms, apprentice contracts, ship passenger lists and newspaper announcements – and concluded that, down the generations, the “iron law” of inheritance had consistently trumped all efforts to improve social mobility in England and Wales.
Or, as Professor Gregory Clark and Dr Neil Cummins, the two economists behind the study, explain: “To those who have, more is given.”
Publication of the study, in this month’s Economic Journal, comes at the end of a week in which the debate about Britain’s meritocratic credentials has dominated the headlines. The competition for the Oscar for best actor is being depicted in some quarters as a two-horse race between an Old Etonian, Eddie Redmayne, and an Old Harrovian, Benedict Cumberbatch, while a recent report by the Organisation for Economic Co-operation and Development (OECD) suggested that the correlation between parents’ earnings and those of their children was higher in Britain than anywhere in the developed world.
After examining the records of 18,869 people, and dividing them into three categories, the rich, the prosperous and the poor, Clark and Cummins agree. They suggest that the passing on of wealth is far more persistent over the generations than previously acknowledged, noting that there is a “significant correlation between the wealth of families five generations apart”. Put simply, the descendants of the wealthy of 1858 are still much wealthier than the average person in 2012.
The economists calculate that this “elasticity” of intergenerational wealth is a remarkably stable 0.75. A zero rating would indicate that no wealth at all was transferred down the generations, while a figure of 1 would suggest the “perfect transmission” of wealth between parents and their children.
Surnames studied in the rich category – whose probate values were among the top 5% of the national average – include that of Sir Joseph Bazalgette, the famous Victorian civil engineer whose great- great-grandson, Sir Peter, is a TV producer and chairman of Arts Council England.
The transfer of wealth between the generations carries additional benefits, according to the study. Not only are the descendants of those who were wealthy in 1850 still wealthy, but they have longer lifespans than average, are more likely to attend Oxford or Cambridge, live in expensive neighbourhoods, and go on to become doctors or lawyers. As Clark and Cummins observe: “What your great-great-grandfather was doing is still predictive of what you are doing now.”
Strikingly, there is no evidence that wealth and status between the generations has declined since the Victorian era. The economists say that, despite the introduction of wealth taxes early in the 20th century, the arrival of mass education and the opening of the universities and professions to a modern meritocracy, social mobility rates have not changed “one iota”.
“Wilson, Thatcher, or Blair – the noisy cacophony of Westminster politics – makes no difference to the iron law of inheritance,” Clark and Cummins write. They add: “There is no more popular political programme than that which calls for enhanced social mobility. Our data suggests there is also no programme more guaranteed to fail.”
The findings appear to echo those of Thomas Piketty, the French economist whose bestselling book, Capital in the Twenty-First Century, argues that the wealthy are becoming wealthier and the poor poorer. However, Clark and Cummins offer an important corrective to Piketty’s analysis. They argue that eventually wealth passed down the generations averages out, although the process takes centuries. They calculate it will take 300 years for descendants of rich 19th-century families to end up being of average wealth. “By 2300 the descendants of the current inhabitants of Kensington and Chelsea will be average in their social status,” the pair suggest.
Nevertheless, Clark said he was struck by “just how stable the inheritance of wealth is across time and how immutable it has been relative to changes in social institutions.”
Clark denied his findings suggested that bringing about a more equal society was a forlorn hope. “It shows that you have to do it directly, by taxing the rich and subsidising the poor,” Clark said. “Measures to promote social mobility have little prospect of succeeding. It’s always going to be the case that families with the greatest abilities will just pass them on to their children.”
