Upward social mobility is a moral and economic challenge for our rulers and policymakers. It is appalling if a child in the 21st century says that s/he is poor because his/her parents are poor. Children in more than 25%of the total Pakistani households, especially those below the poverty line, do not even have the opportunity to be on the path toward a better life or have to remain chained to their parents and grandparents’ socio-economic status. According to the Global Social Mobility report, prepared by the World Economic Forum, Pakistan ranked 79th among 82 nations. Three countries below Pakistan are Cameroon, Senegal, and Cote d’Ivoire. Healthcare, education and labor market conditionsare major channels in social mobility. After 73 years of independence, we failed to develop a system to reduce the class-based discrimination in access for these primary domains.
Enormous differences exist in access to education, learning outcomes, and transition from lower to higher level between children belonging to different socio-economic backgrounds. The persistent discrimination in the system across generations reduces the aspirations, hopes, and motivation among children and youth. The statistics across the globe support the argument that the learning gap in initial schooling years also persists at a higher or tertiary level. The longitudinal data is not available in Pakistan to study intergenerational social mobility, but few indicators are available to understand the enormous learning disparities. These disparities lead to differences in labor market outcomes at a later stage and remain persistent across generations. For instance, 42% of children enrolled in class 5 cannot read a story in any of their preferred languages. This proportion is 52% in Balochistan and 66% in Sindh. At the same level of education, only 57% can do 2-digit division. Annual Survey of Education Report (ASER) counts that only 56% of fathers of this cohort of children and 40%’s mothers have primary education. These numbers continue deteriorating as we segregate the data based on gender, urban/rural, and public/private schooling. There are well-defined boundaries for rich and poor children; the gap between these boundaries continues to widening until they reach a labor market. Most poor children are attending bad quality schools and find it impossible to compete in mathematics, communication, and analytical skills with their peers coming from excellent expensive schools and trained by good quality teachers.
The inherence of wealth is not limited to physical capital; it’s also the inherited social capital that matters a lot in the labor market, which is deeply embedded in the recruitment and market facilitation process
Similarly, the Total Fertility Rate is 3.2 in the richest quantile and 3.6 in the lowest quantile. Many children die before their 2nd or 5th birthday because their parents are poor. The under-5 child mortality rate is 52 per 1000 live births for the richest quantile and 95 for the lowest quantile. Thus almost 43 per 1000 babies die because they lost the lottery to be born in the wealthiest household. The average statistics presented on any social issues are highly misleading because huge disparities exist in different social classes. The women in the most impoverished family have limited or no access to additional nutrition, and thus, the infants in those households are often more vulnerable to many childhood diseases.
Transferred benefits from rich Parentsdue to their higher level of education and high employment status significantly impact their offspring’s labor market outcomes. Networks play a very important role while climbing up in the labor market. Many young entrepreneurial minds remain out of business because they do not have access to credit, have limited networks with authorities to get the so-called NOCs to enter the market. The social capital of rich, which includes networks, shared norms, understanding of co-operation, and facilitation within and between different socio-economic groups, is different and much stronger from those of the poor. Our system allows for this kind of social capital to create hindrances for some and clear the way for others toward better lives and opportunities to enjoy.This kind of cycle for hoarding the opportunities continues from one generation to another. The amount of assets in the rich hands is much higher than those in the lowest socio-economic strata. Whilst the more significant issue is not only the assets, it’s the return on assets. The returns on investments are multiple times higher than those with a much smaller distribution of assets, so the gap between rich and poor is continuously increasing. The inherence of wealth is not limited to physical capital; it’s also the inherited social capital that matters a lot in the labor market, which is deeply embedded in the recruitment and market facilitation process.
Few developing countries, for instance, Moldova, South Korea, Malaysia, Indonesia, already set the examples for upward social mobility through affirmative policy actions: by providing their children and youth equal opportunities to enter into a completely different and better lifestyle from their ancestors. It requires only a thoughtfully designed social policy and few well-articulated interventions. Unfortunately, many of our political leaders give significant attention to cash transfer and not to structural transformation. The targeted approach for investment in early childhood, labor market reforms, especially in terms of financial inclusion and opening the equal opportunities, are required to break the cycle of intergenerational deprivation.
Author is professor of economics at Institute of Business Administration, Karachi