If you're so smart.....

In a review of Robert Putnam's new book, Jason DeParle (a reporter for the New York Times) says "where Putnam succeeds is in describing the diverging life chances of children in rich and poor families. ('Rich' parents finished college; 'poor' parents have high school degrees or less.) "   Of course, education is not really equivalent to riches, as many adjunct professors could tell you, but this led me to wonder exactly how much overlap there is the incomes of different educational groups.  

It's easy to find statistics on differences in average income by education, but harder to find information on the whole distribution.  Here is a table, which I made from Bureau of Labor Statistics data on "usual weekly earnings of full-time wage and salary workers."

                           Percentiles

                  10th   25th  50th    75th   90th

Not HS Grad       301     374 488     657    887

HS Grad           367     482 668     960   1355

Some College      398     532 761    1111   1560

Bachelor's        529     744 1101   1647   2368

Advanced Degree   588     953 1386   2009   2974

Education raises the "ceiling" more than the "floor"--the 10th percentile for people with an advanced degree is less than twice the 10th percentile of people who aren't high school graduates, while the 90th percentile is about 3.3 times as high.  You can get a sense of the overlap by comparing percentiles--for example, someone who's at the 90th percentile for those who aren't high school graduates would be well below the median for people with a bachelor's degree.  

For a more detailed comparison, I assumed that earnings followed a log-normal distribution (which is usually approximately true except in the highest levels) and estimated the mean and standard deviation from the data above.  The resulting distributions are shown in this figure (I scaled it up to earnings per year):

The figure makes it clear that people without a high school degree have little chance of being rich, or even affluent.  People with just a high school degree, however, have a reasonable chance to make it to the upper middle class.