Adolescent Exposure to Economic Inequality and Belief in the ‘American Dream’ on Entering Adulthood

Abstract The growth in economic inequality in the United States over the past forty years has stimulated interest among scholars in the effects of exposure to inequality on the American people. A prominent vein of scholarship explores whether exposure to inequality diminishes belief in a key pillar of the ‘American dream’ – the meritocratic ideal that hard work will translate to economic success. We offer this literature a novel test that explores the relationship between quotidian exposure to economic inequality in one’s adolescent residential context and belief in the American dream among roughly 1.3 million late-adolescent Americans entering college. We find that adolescent residence in high-inequality areas is associated with decreased belief in the American dream upon entering adulthood. Further analysis revealed that this relationship is most pronounced among young Americans raised in higher income households.