Tracking Covid Recovery and Improving Social Mobility with Opportunity Insights

David Williams serves as the Director of Policy Outreach at Opportunity Insights, a research and public policy lab based at Harvard University dedicated to using big data to improve upward mobility in America. The lab is led by Professors Raj Chetty, John Friedman, and Nathaniel Hendren. David is tasked with supporting research and evidence-based policy change by creating and leading partnerships with communities across the country. Opportunity Insights’ current projects include Creating Moves to Opportunity (CMTO), a national housing mobility initiative, and the Charlotte Opportunity Initiative, a community-wide place-based initiative aimed at improving economic opportunity throughout Charlotte and Mecklenburg County.

With a mission to develop scalable policy solutions that will empower families to rise through poverty, Opportunity Insights adopts a unique lab-based, team-based approach to economic research with a large team of “pre-doctoral” research fellows and policy experts. They believe they’re helping create the future of social sciences research.

After the Covid-19 pandemic hit the U.S., the lab embarked on an ambitious project – tracking and providing real-time economic data. At the heart of political debates happening today is the issue of re-opening the economy. On one side of the debate, some are suggesting that businesses need to open up immediately to stimulate an economy in trouble. However, data from last June provided by Opportunity Insights suggested that lifting state-mandated closing of businesses had no significant effect on economic activity.

Likewise with the similar debate on stimulus checks, Opportunity Insights argued that the reduction of consumer spending associated with Covid-19 was due to supply shocks, not a lack of purchasing power per se. In other words, businesses couldn’t open up, and people weren’t willing to spend more because of the concern for the virus. Raj Chetty recommended expanding the social safety net and extending unemployment benefits as a means to limit hardship among low-income workers rather than an all-encompassing stimulus check, which might not be the best solution to boosting consumer spending.

One of OI’s ongoing projects on social mobility at large is Creating Moves to Opportunity (CMTO), an experiment with the Seattle housing authority. This initiative works to reduce challenges families face when using federal rental assistance to find housing by offering services with the housing search process, help with landlords, security deposits etc. The initiative has shown much success, demonstrating an increase from 14% to 54% in moves to high-upward mobility neighborhoods. One misconception that CMTO’s data overturned is that families live in low-opportunity areas because of differences in rent prices.

Raj Chetty, founding director of Opportunity Insights, has long been praised by many as the most influential applied micro-economist of this generation, especially with his innovation on using big data to study economics and improve upward mobility in America. The sheer vastness of OI’s big data (20 million children in the CMTO project) could lend us nuances that aggregate data cannot. What is the key to using big data to harness economic insights? To put it differently, what is preventing some average data scientist/economist/hedge fund manager with more data to gain more insights on issues like Covid and social mobility than the researchers at OI?

David Williams