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Making Big Data Actionable: Economist Raj Chetty Brings Unique Brand of Research to Equity and Education

By Karen Dybis

Taxes, educational equity, unemployment: When it comes to research, Raj Chetty takes on topics other economists might avoid.

Chetty’s work as one of the nation’s top economists could be boiled down to one question: How can we as a country give children from disadvantaged backgrounds better opportunities? Chetty believes that with data, innovative programs and a lot of curiosity, the United States can help more people achieve the American Dream.

“We’re trying to bring modern data – ‘Big Data’ – to bear on these questions of equality and social mobility,” Chetty said from his office as the William A. Ackman Professor of Economics at Harvard University. He also is the director of Opportunity Insights, which uses big data to understand how the United States can boost the success rate for children of disadvantaged backgrounds.

What makes Chetty’s work stand out is the way he works – he blends empirical evidence with his expertise in economic theory. The result is easy-to-understand solutions that take government programs and long-standing notions about poverty, education and economic mobility and turns them into effective policies.

DATA SHOWS INEQUALITY  OF OPPORTUNITY 

In other words, Chetty is the kind of economist who wants to make data not only accessible but actionable. For example, he delved into IRS tax data to show what he calls “inequality of opportunity” right down to the neighborhood level. He looks at cities from a micro and macro perspective, including Detroit and Michigan, to understand why some children rise and others, especially Black young men, can face downward mobility.

“In Detroit, the racial divide is significant. As a population, it’s an important issue. How do you create better opportunity for Black Americans living in Detroit?” Chetty asked. “Where are they living? How can they do better? An important piece of the puzzle that we find in our data is … there is a persistent effect of racial disparity. It’s not just about giving more resources to schools. It’s about why Black kids going to the best schools still have disparities.”

One solution Chetty recommends is early intervention with quality preschool as well as top-tier teachers early on. Others include mentorship and looking at the criminal justice system to ensure Black men are present in neighborhoods as fathers and leaders.

INTERRUPTIONS AT YOUNGER AGES HAVE LIFELONG IMPACTS 

In other words, action based on data will lead to important changes for mobility, equality and a better life for all. In that regard, he walks the talk: Chetty is part of a pilot program in Seattle working with families to help them better utilize housing vouchers to move to higher-opportunity areas. These interventions at younger ages have life-long impacts on income potential and overall success, he notes. Detroit could create similar programs, he said.

“Detroit has made great strides in recent years, bringing back major employers and its overall revitalization,” Chetty said. “But does that benefit current Detroiters versus people moving in? … To remedy that, you need a deliberate strategy to increase upward mobility and connect (Detroit residents) to these jobs.”

Business and governmental leaders need to think about how to build a pipeline for people to succeed – and that all comes back to the things that matter most, such as taxes, educational equity and unemployment.

“For the business community, they need to understand that at the end of the day, their ability to thrive depends on human capital. How can you build up a better pool of skills? You invest in the people, and especially in the kids growing up in Detroit,” Chetty said. “It’s in their own interests in the long run to make these investments, to give back to the local community and to create a pipeline to opportunity.”

Karen Dybis is a freelance writer in Metro Detroit.