Wikipedia, substituting for a dictionary, defines a longitudinal study as “a correlational research study that involves repeated observations of the same variables over long periods of time”. Contrast that with a cross-sectional study, which everyone’s favorite encyclopedia terms “a class of research method that involve observation of all of a population, or a representative subset, at one specific point in time.”
Really, we here at DQYDJ wish more people knew the differences between the two, and most importantly, when one is superior to another. One place where a longitudinal study is vastly superior is the political hot-button topic of income inequality. You see, contrary to popular opinion, there is actually a sizable amount of movement between income quintiles – incomes of people in the United States don’t tend to stay in the same place for a long time. From the study put out by the Treasury Department (1996-2005 incomes): “Less than half (40 percent or 43 percent depending on the measure) of those in the top 1 percent in 1996 were still in the top 1 percent in 2005.” Please click through to the article to see the dynamic content.
The Top 1% Of Today Will Not Be There in Ten Years
I’m not talking about revolution, I’m talking about income mobility. Volatility at the top is the name of the game. Every generation produces new wealth and new means to catapult people into the top 1%. Many incomes in the 1% now are also incredibly volatile – near the top, a high proportion of incomes are married to stock market returns.
In the Treasury’s study, only 42.4% of the lowest quintile of incomes they tracked in 1996 remained in the lowest quintile in 2005. Furthermore, while quintile means that the incomes were broken down into 20% blocks, only 13.2% of those original incomes were in the lowest quintile in 2005. The biggest gainer? The highest quintile, with 27.1% of the originals. Doesn’t it make sense? Incomes tend to increase over time and a high number of workers coming into the workforce start out in the lowest quintile. Far from a stratified society with no chance to get ahead, the United States is actually a country with a respectable amount of income mobility. It’s not automatic (as you can see in the following chart) – but there still are opportunities for people in this country to get ahead.
Check it out… up and to the right! The graph is lower on the left because the incomes of the group in 1996 tended to move up to higher quintiles as more incomes entered the workforce. Hovering over any point will let you know how the 1996 quintile was doing in 2005. Also note that some of the top quintile fell to the lowest quintile in 2005.
The United States Still Encourages the American Dream – Even Through the Great Recession
Luckily, through all of the rough times the country has gone through, the Unites States is still an incredible wealth generator. It’s also exceedingly fair – incomes tend to increase if you work hard. All it took was a longitudinal study to tease that out. Comments?