Interesting data point — its not just the top 1% who are thriving, nor just the top 0.1%, who are really killing it — but the Upper Middle Class is doing well also. According to an Urban Institute paper, The Growing Size and Incomes of the Upper Middle Class using absolute income thresholds [adjusted for inflation and family…Read More
Lily Tomlin — “The trouble with being in the rat race is that even if you win, you’re still a rat.”
I suspect you’ll start seeing more press about this study in the coming weeks. I followed the link to the Urban Institute and downloaded the paper. I pretty much stopped reading the paper when the author wrote,
The study did not adjust for regional differences in the cost of living…Not using area price differences certainly means that some families were incorrectly categorized in this five-level class structure. However, inaccurately placing people from Washington, DC, as upper middle class because they have incomes just above $100,000, even though they have high local costs and would not generally be considered as being upper middle class in that location, is offset by categorizing Des Moines, IA, families with incomes just below $100,000 as being middle class, even though those families could be considered upper middle class because costs in their area are low. Because the point of this exercise was to determine large changes in social classes, any bias one way or the other should not be large.
Talk about a fatal flaw in methodology. Add in the faulty assumption that “…any bias one way or the other should not be large” and you have IMHO a study that is worthless.
Tell me, how can you be “upper middle class” solely by income level if you have the cost of living in Manhattan, Miami, Boston, Chicago, San Francisco, Los Angeles, or Seattle?
Here’s another critic of the study: