Cultural persistence

From Brave Old World: Immigration, inequality and intergenerational mobility in the US by Thor Berger and Per Engzell.

There are striking regional variations in economic opportunity across the US. This column proposes a historical explanation for this, showing that local levels of income equality and intergenerational mobility in the US resemble those of the European countries that current inhabitants trace their origins from. The findings point to the persistence of differences in local culture, norms, and institutions.

Consistent with the work of Gregory Clark. Related to the theories of economic development positing path dependence. The regions with the earliest transitions from metal working and other technologies are those with the greatest development today. Also consistent with many posts in which I discuss the linkages between productivity and cultural origins.
From the paper:

Do these places where descendants of European immigrants live show systematic similarities to the countries their ancestors came from? In a recent paper (Berger and Engzell 2019), we show that this is indeed the case. For example, equality and mobility are highest in the Midwest, where Scandinavian ancestry is common. The same goes for every group we study – for example, income mobility is lowest in areas where the population has Italian or British roots.

We use the regional concentration of ancestral groups to create ‘synthetic’ European countries (aggregates of places within the US with a heavy overrepresentation of a given group). Comparing these synthetic countries to their European counterparts reveals a virtually identical gradient in inequality and intergenerational mobility. Hence, the Great Gatsby curve also emerges when one compares levels of income inequality and intergenerational mobility across these synthetic European countries (see Figure 1).

They conclude.

Our results speak to the long-run impact that European immigrants had on their communities (Sequeira et al. 2019) and, conversely, to the historical roots of cross-country differences in inequality as we know them today. Indeed, existing literature documents how cultural beliefs and preferences are transmitted from parents to children and can persist over multiple immigrant generations (Rice and Feldman 1997, Algan and Cahuc 2010, Luttmer and Singhal 2011). While such cultural transmission is well established, we provide new evidence of how different conceptions about the organisation of society can persistently shape places, policies, and opportunity in the long run.

Yep. Culture matters and it matters consequentially.

The authors do not mention one other aspect. Yes, there is cultural persistence which facilitates mirror income and mobility traits. But, the American system also magnifies. Scandinavian American regions reflect similar rates of mobility and inequality as in Scandinavia. Except at a higher level. Scandinavian Americans are richer than their counterparts, score better on reading, on maths, safety, etc. Every origin group reflects similar distribution as their home group except at a higher level of well-being.