Karen Duffin

Because in the original program, you know, way back in the 90s, people who were given vouchers on the condition that they had to move to a better neighborhood, more than half of those people just gave the voucher back, basically said, I would rather forfeit this than be told where I have to move.

Because in the original program, you know, way back in the 90s, people who were given vouchers on the condition that they had to move to a better neighborhood, more than half of those people just gave the voucher back, basically said, I would rather forfeit this than be told where I have to move.

So if Nathan wants this to be more than just a nice research paper with nice data about opportunity, someone will need to figure out how to get people to actually move to that opportunity. So Nathan and his team, they start working with cities to basically reboot moving to opportunity. The original MTO program, it required people who got the special vouchers to move to low-poverty areas.

So if Nathan wants this to be more than just a nice research paper with nice data about opportunity, someone will need to figure out how to get people to actually move to that opportunity. So Nathan and his team, they start working with cities to basically reboot moving to opportunity. The original MTO program, it required people who got the special vouchers to move to low-poverty areas.

But in this reboot, families can choose to move wherever they want. What Nathan and his team are trying to test is whether people have not been moving to Opportunity because they don't want to, or is it just because they need a little support? So in their first test city in Seattle, one group gets a voucher and the other group gets a voucher, but also support.

But in this reboot, families can choose to move wherever they want. What Nathan and his team are trying to test is whether people have not been moving to Opportunity because they don't want to, or is it just because they need a little support? So in their first test city in Seattle, one group gets a voucher and the other group gets a voucher, but also support.

A sort of housing counselor to help navigate things like transportation in the new neighborhood. even helps cover security deposits. These counselors also work with landlords. Could this simple intervention get people to move voluntarily?

A sort of housing counselor to help navigate things like transportation in the new neighborhood. even helps cover security deposits. These counselors also work with landlords. Could this simple intervention get people to move voluntarily?

But they tried it out in Seattle. And after a year?

But they tried it out in Seattle. And after a year?

Everyone settles into their chairs, you know, sipping their government-brewed coffee, and the meeting starts. They learn that they are about to join a test program. Small in the scheme of HUD overall, but a huge change. They're going to start handing out a new kind of voucher to a small group of their tenants. And then HUD is going to run an experiment on them.

Everyone settles into their chairs, you know, sipping their government-brewed coffee, and the meeting starts. They learn that they are about to join a test program. Small in the scheme of HUD overall, but a huge change. They're going to start handing out a new kind of voucher to a small group of their tenants. And then HUD is going to run an experiment on them.

More than three times the number of people chose to move to an area with higher opportunity when they were given support from a counselor. And all of this data from the original MTO study, this new one, was so compelling that the unthinkable happened. Congress recently passed a bipartisan bill giving federal funds to replicate programs like this across the country.

More than three times the number of people chose to move to an area with higher opportunity when they were given support from a counselor. And all of this data from the original MTO study, this new one, was so compelling that the unthinkable happened. Congress recently passed a bipartisan bill giving federal funds to replicate programs like this across the country.

Nathan and that team will also be expanding to new cities. And yes, we do now know that housing policy can be hope. Housing policy, we are sorry we underestimated you. Thank you for your service. But for now, we can probably only call it a sliver of hope because the number of families whose lives are improving through this program is really just a tiny drop in a much bigger pool.

Nathan and that team will also be expanding to new cities. And yes, we do now know that housing policy can be hope. Housing policy, we are sorry we underestimated you. Thank you for your service. But for now, we can probably only call it a sliver of hope because the number of families whose lives are improving through this program is really just a tiny drop in a much bigger pool.

With the old vouchers, people could, at least in theory, move anywhere they wanted. But people who get this new voucher, they are required to use it to move to what HUD calls low-poverty neighborhoods. So just a nicer neighborhood. This is sort of a radical change for HUD.

With the old vouchers, people could, at least in theory, move anywhere they wanted. But people who get this new voucher, they are required to use it to move to what HUD calls low-poverty neighborhoods. So just a nicer neighborhood. This is sort of a radical change for HUD.

Unlimited in theory, at least. But what the majority of tenants have chosen was to use the vouchers to stay in high-poverty neighborhoods for a lot of complicated reasons, including discrimination. Landlords often refuse to take Section 8 tenants. So back in the basement at HUD, as this big new idea gets introduced—

Unlimited in theory, at least. But what the majority of tenants have chosen was to use the vouchers to stay in high-poverty neighborhoods for a lot of complicated reasons, including discrimination. Landlords often refuse to take Section 8 tenants. So back in the basement at HUD, as this big new idea gets introduced—

I imagine people, you know, put down their government brewed coffee and start raising their hands. Like, why are we doing this? Our job is to move people into housing, period. Now HUD is basically asking them to reverse that, to move people out.

I imagine people, you know, put down their government brewed coffee and start raising their hands. Like, why are we doing this? Our job is to move people into housing, period. Now HUD is basically asking them to reverse that, to move people out.

Mark and the people running this meeting, they're like, yeah, I know. But now our job is to move people to opportunity. You know, the government spends money across all kinds of programs just trying to improve people's lives like give them better education or health or increase their income.

Mark and the people running this meeting, they're like, yeah, I know. But now our job is to move people to opportunity. You know, the government spends money across all kinds of programs just trying to improve people's lives like give them better education or health or increase their income.

And the big idea that they want to test is can we improve all of those things and more all at once just by moving a family somewhere new? But, of course, to get the government to give money, you have to prove that it works.

And the big idea that they want to test is can we improve all of those things and more all at once just by moving a family somewhere new? But, of course, to get the government to give money, you have to prove that it works.

You know, control group, independent variable. We will run an actual scientific experiment and we'll track the data for decades.

You know, control group, independent variable. We will run an actual scientific experiment and we'll track the data for decades.

Can changing someone's address change their life? The answer to that seems very obvious. But this experiment did not at all go as planned.

Can changing someone's address change their life? The answer to that seems very obvious. But this experiment did not at all go as planned.

This is Planet Money from NPR.

This is Planet Money from NPR.

Hello and welcome to Planet Money. I'm Karen Duffin. Today on the show, we are riding a social policy roller coaster. Alongside the researchers who ran this experiment and the people they tested it on, people who were not always excited to be experimented on, it is a quest to make the American dream a reality. A quest that economists thought failed, but is in the midst of an unexpected revival.

Hello and welcome to Planet Money. I'm Karen Duffin. Today on the show, we are riding a social policy roller coaster. Alongside the researchers who ran this experiment and the people they tested it on, people who were not always excited to be experimented on, it is a quest to make the American dream a reality. A quest that economists thought failed, but is in the midst of an unexpected revival.

Mark and this tiny band of public housing staff leave that conference room, go forth from D.C., and start signing up tenants. The way it worked was this. Tenants from the five chosen cities would be assigned by lottery to one of three groups. Like any good experiment, there would be a control group. This group already lives in public housing and they would stay in public housing.

Mark and this tiny band of public housing staff leave that conference room, go forth from D.C., and start signing up tenants. The way it worked was this. Tenants from the five chosen cities would be assigned by lottery to one of three groups. Like any good experiment, there would be a control group. This group already lives in public housing and they would stay in public housing.

So no change to group one. Group two would get a regular Section 8 voucher. This is the rent subsidy that they can theoretically use with any landlord who will take it. And group three, this group is the experimental group.

So no change to group one. Group two would get a regular Section 8 voucher. This is the rent subsidy that they can theoretically use with any landlord who will take it. And group three, this group is the experimental group.

They would also get the Section 8 voucher, but they had to use it to move out to a completely different neighborhood, one where just 10% or less of their neighbors were what the government has classified as poor. For context, most of them had been living in neighborhoods with about 50% poverty. So HUD was asking them to move to what should hopefully be a better neighborhood.

They would also get the Section 8 voucher, but they had to use it to move out to a completely different neighborhood, one where just 10% or less of their neighbors were what the government has classified as poor. For context, most of them had been living in neighborhoods with about 50% poverty. So HUD was asking them to move to what should hopefully be a better neighborhood.

But not everyone was excited about that.

But not everyone was excited about that.

When HUD surveyed families about this, the families said, yes, we do want a voucher, but we want it just because we want to make sure our house is decent and we want to get into a safer neighborhood.

When HUD surveyed families about this, the families said, yes, we do want a voucher, but we want it just because we want to make sure our house is decent and we want to get into a safer neighborhood.

For them, housing was just housing, not opportunity.

For them, housing was just housing, not opportunity.

The vast majority of people who get vouchers do not use them to move to areas with lower poverty.

The vast majority of people who get vouchers do not use them to move to areas with lower poverty.

Also, Mark and his HUD crew were asking people to participate in a science experiment on themselves, asking them to be living test subjects for a theory they have not proven yet, which is an especially hard thing to take from the federal government, a government that has a history of intentionally segregating people of color into high-poverty neighborhoods. The experiment took years to set up.

Also, Mark and his HUD crew were asking people to participate in a science experiment on themselves, asking them to be living test subjects for a theory they have not proven yet, which is an especially hard thing to take from the federal government, a government that has a history of intentionally segregating people of color into high-poverty neighborhoods. The experiment took years to set up.

But in the end, about 4,600 families were part of it. And in 1994, the moving began. We were not able to talk to the families that moved, but NPR's Morning Edition did cover the study while it was happening. Stevenskeep spoke to a mother named Shirley Hudnall who had moved with her 15-year-old son, Brian. She talked to him about some of the things that do make these kinds of moves hard.

But in the end, about 4,600 families were part of it. And in 1994, the moving began. We were not able to talk to the families that moved, but NPR's Morning Edition did cover the study while it was happening. Stevenskeep spoke to a mother named Shirley Hudnall who had moved with her 15-year-old son, Brian. She talked to him about some of the things that do make these kinds of moves hard.

For four years, across the five test cities, people like Shirley moved, and the researchers waited. And in 2008, the researchers finished gathering the data, and what it told them surprised them.

For four years, across the five test cities, people like Shirley moved, and the researchers waited. And in 2008, the researchers finished gathering the data, and what it told them surprised them.

For one thing, moving was better for girls than for boys.

For one thing, moving was better for girls than for boys.

Parents reported better health, something HUD hadn't even originally planned to measure, improved mental health and physical health.

Parents reported better health, something HUD hadn't even originally planned to measure, improved mental health and physical health.

All of which, of course, is wonderful, but this is not what the experiment was designed to test. What they wanted to test was the, quote, long-term housing employment and educational achievements of families involved.

All of which, of course, is wonderful, but this is not what the experiment was designed to test. What they wanted to test was the, quote, long-term housing employment and educational achievements of families involved.

And this massive, scientifically designed and rigorously tested social experiment that had moved thousands of people, just to answer the question, can changing someone's address change the course of their economic life? The answer to that question was no.

And this massive, scientifically designed and rigorously tested social experiment that had moved thousands of people, just to answer the question, can changing someone's address change the course of their economic life? The answer to that question was no.

Basically, no impact on educational outcomes, employment, or income. If you want to improve those things, the final report said, housing is not your answer. Housing is just housing. And with that, all of the hopes and dollars and research and programs that had been going towards this idea about housing, a lot of that just got rerouted to other ideas. But then this thing happened.

Basically, no impact on educational outcomes, employment, or income. If you want to improve those things, the final report said, housing is not your answer. Housing is just housing. And with that, all of the hopes and dollars and research and programs that had been going towards this idea about housing, a lot of that just got rerouted to other ideas. But then this thing happened.

About four years after that final sad MTO data came out, another researcher badged into his government cubicle, this time on the 10th floor of the IRS headquarters in D.C., And like Mark, he wanted to understand how to improve people's economic lives.

About four years after that final sad MTO data came out, another researcher badged into his government cubicle, this time on the 10th floor of the IRS headquarters in D.C., And like Mark, he wanted to understand how to improve people's economic lives.

This is Nathan Hendren. He's an economist from Harvard. And for a few years, he and some of his research pals had been granted access to tax records at the IRS, with all kinds of privacy restrictions, of course.

This is Nathan Hendren. He's an economist from Harvard. And for a few years, he and some of his research pals had been granted access to tax records at the IRS, with all kinds of privacy restrictions, of course.

Once upon a time, in a cubicle not so far away, sat a government bureaucrat in his government-issued chair preparing for a very big meeting. It was 1994, and Mark Schroeder was an economist at HUD, the Department of Housing and Urban Development, and his team in D.C. had just flown in local public housing authorities from five major cities.

Once upon a time, in a cubicle not so far away, sat a government bureaucrat in his government-issued chair preparing for a very big meeting. It was 1994, and Mark Schroeder was an economist at HUD, the Department of Housing and Urban Development, and his team in D.C. had just flown in local public housing authorities from five major cities.

Having that much data allows them to be so much more precise.

Having that much data allows them to be so much more precise.

Nathan is trying to understand the impact of tax policies on upward mobility, which is economists speak for, can you achieve the American dream? Can a child go from the bottom income bracket to, over time, the top income bracket? And this is an issue that has become increasingly urgent.

Nathan is trying to understand the impact of tax policies on upward mobility, which is economists speak for, can you achieve the American dream? Can a child go from the bottom income bracket to, over time, the top income bracket? And this is an issue that has become increasingly urgent.

Right now, the data says that you are twice as likely to be able to achieve the American dream in Europe, or at least a lot of countries in Europe. So Nathan is looking at tax records from across the country, and he does start seeing a pattern. A pattern that surprised him. That huge MTO study. It looked like it had missed something. Something enormous.

Right now, the data says that you are twice as likely to be able to achieve the American dream in Europe, or at least a lot of countries in Europe. So Nathan is looking at tax records from across the country, and he does start seeing a pattern. A pattern that surprised him. That huge MTO study. It looked like it had missed something. Something enormous.

After the break, the experiment that changed everything has to change. Okay, so Nathan Hendren was knee-deep in all of this income tax data at the IRS. alongside his researcher pal Raj Chetty.

After the break, the experiment that changed everything has to change. Okay, so Nathan Hendren was knee-deep in all of this income tax data at the IRS. alongside his researcher pal Raj Chetty.

They'd seen this data that showed a pattern. People who are rising from the bottom income bracket to the top income bracket aren't just randomly scattered across the country. They're clustered. And your chances of escaping poverty vary widely depending on which cluster you're in. So Nathan digs in deeper. He's starting to look at families who moved into higher mobility neighborhoods.

They'd seen this data that showed a pattern. People who are rising from the bottom income bracket to the top income bracket aren't just randomly scattered across the country. They're clustered. And your chances of escaping poverty vary widely depending on which cluster you're in. So Nathan digs in deeper. He's starting to look at families who moved into higher mobility neighborhoods.

Like, let's say you have two kids and you move them to this better neighborhood and one of your kids is four when you move and the other one is eight.

Like, let's say you have two kids and you move them to this better neighborhood and one of your kids is four when you move and the other one is eight.

Where you live matters for whether you have a shot at achieving the American dream, which sounds terribly obvious. But that contradicts what Moving to Opportunity found, that huge HUD study.

Where you live matters for whether you have a shot at achieving the American dream, which sounds terribly obvious. But that contradicts what Moving to Opportunity found, that huge HUD study.

Nathan starts to map income tax data from the actual MTO participants. And this more precise MTO data confirms the pattern that they saw nationally. In fact, the data is so strong that they can say the new neighborhood actually caused the person's economic improvements. That's how much a change of address mattered.

Nathan starts to map income tax data from the actual MTO participants. And this more precise MTO data confirms the pattern that they saw nationally. In fact, the data is so strong that they can say the new neighborhood actually caused the person's economic improvements. That's how much a change of address mattered.

But they also start to realize that it really only mattered for a subset of the MTO participants, only for kids who were younger than 13 years old when they moved. And this explains why HUD missed this outcome. Nathan was looking at the data in 2014. HUD had last looked at this data six years before that, in 2008.

But they also start to realize that it really only mattered for a subset of the MTO participants, only for kids who were younger than 13 years old when they moved. And this explains why HUD missed this outcome. Nathan was looking at the data in 2014. HUD had last looked at this data six years before that, in 2008.

Those younger kids had now grown up, started earning money, started producing income tax data, and they were finally grown up enough now for the data to reveal itself. And what the data was saying was that housing had been hope. Even though they had spent 14 years on this study, they had just counted it out too early.

Those younger kids had now grown up, started earning money, started producing income tax data, and they were finally grown up enough now for the data to reveal itself. And what the data was saying was that housing had been hope. Even though they had spent 14 years on this study, they had just counted it out too early.

It's so crazy how just by happenstance, kind of, you guys were studying this at a moment where you could actually see that.

It's so crazy how just by happenstance, kind of, you guys were studying this at a moment where you could actually see that.

What they found specifically is that kids who move under the age of 13, over time, they earn about 30 percent more.

What they found specifically is that kids who move under the age of 13, over time, they earn about 30 percent more.

Teen pregnancies, less likely. The data also seems to indicate that these benefits will probably be passed on to their children. This all did come with a caveat. For kids who are moved when they're older than 13, they earn less over time. The move is actually slightly harmful for that group.

Teen pregnancies, less likely. The data also seems to indicate that these benefits will probably be passed on to their children. This all did come with a caveat. For kids who are moved when they're older than 13, they earn less over time. The move is actually slightly harmful for that group.

The staff gathers in a basement conference room. It's about 30 people. These are people who run what's now known as the Section 8 Voucher Program, which is a voucher that subsidizes rent for low-income families. It's like a monthly payment to a landlord. Families can wait years on waiting lists just to get one.

The staff gathers in a basement conference room. It's about 30 people. These are people who run what's now known as the Section 8 Voucher Program, which is a voucher that subsidizes rent for low-income families. It's like a monthly payment to a landlord. Families can wait years on waiting lists just to get one.

But when you look at the younger kids, and over time as they earn more money, they pay more income taxes, and with that, the program actually looks like it pays for itself. So Nathan and his research pals are looking at all of this really exciting data.

But when you look at the younger kids, and over time as they earn more money, they pay more income taxes, and with that, the program actually looks like it pays for itself. So Nathan and his research pals are looking at all of this really exciting data.

They write all this up in a paper, they release it, and then... Overnight, we were inundated.

They write all this up in a paper, they release it, and then... Overnight, we were inundated.

Did you get a lot of those emails before this? No.

Did you get a lot of those emails before this? No.

Many of these emails are coming from people who work in public housing who are saying, look, now that we know that this thing works, we should reboot the original HUD program. And Nathan is excited about that prospect, but he does know that if they reboot this, there needs to be an important addition.

Many of these emails are coming from people who work in public housing who are saying, look, now that we know that this thing works, we should reboot the original HUD program. And Nathan is excited about that prospect, but he does know that if they reboot this, there needs to be an important addition.

Because in the original program, you know, way back in the 90s, people who were given vouchers on the condition that they had to move to a better neighborhood, more than half of those people just gave the voucher back, basically said, I would rather forfeit this than be told where I have to move.

So if Nathan wants this to be more than just a nice research paper with nice data about opportunity, someone will need to figure out how to get people to actually move to that opportunity. So Nathan and his team, they start working with cities to basically reboot moving to opportunity. The original MTO program, it required people who got the special vouchers to move to low-poverty areas.

But in this reboot, families can choose to move wherever they want. What Nathan and his team are trying to test is whether people have not been moving to Opportunity because they don't want to, or is it just because they need a little support? So in their first test city in Seattle, one group gets a voucher and the other group gets a voucher, but also support.

A sort of housing counselor to help navigate things like transportation in the new neighborhood. even helps cover security deposits. These counselors also work with landlords. Could this simple intervention get people to move voluntarily?

But they tried it out in Seattle. And after a year?

Everyone settles into their chairs, you know, sipping their government-brewed coffee, and the meeting starts. They learn that they are about to join a test program. Small in the scheme of HUD overall, but a huge change. They're going to start handing out a new kind of voucher to a small group of their tenants. And then HUD is going to run an experiment on them.

More than three times the number of people chose to move to an area with higher opportunity when they were given support from a counselor. And all of this data from the original MTO study, this new one, was so compelling that the unthinkable happened. Congress recently passed a bipartisan bill giving federal funds to replicate programs like this across the country.

Nathan and that team will also be expanding to new cities. And yes, we do now know that housing policy can be hope. Housing policy, we are sorry we underestimated you. Thank you for your service. But for now, we can probably only call it a sliver of hope because the number of families whose lives are improving through this program is really just a tiny drop in a much bigger pool.

With the old vouchers, people could, at least in theory, move anywhere they wanted. But people who get this new voucher, they are required to use it to move to what HUD calls low-poverty neighborhoods. So just a nicer neighborhood. This is sort of a radical change for HUD.

Unlimited in theory, at least. But what the majority of tenants have chosen was to use the vouchers to stay in high-poverty neighborhoods for a lot of complicated reasons, including discrimination. Landlords often refuse to take Section 8 tenants. So back in the basement at HUD, as this big new idea gets introduced—

I imagine people, you know, put down their government brewed coffee and start raising their hands. Like, why are we doing this? Our job is to move people into housing, period. Now HUD is basically asking them to reverse that, to move people out.

Mark and the people running this meeting, they're like, yeah, I know. But now our job is to move people to opportunity. You know, the government spends money across all kinds of programs just trying to improve people's lives like give them better education or health or increase their income.

And the big idea that they want to test is can we improve all of those things and more all at once just by moving a family somewhere new? But, of course, to get the government to give money, you have to prove that it works.

You know, control group, independent variable. We will run an actual scientific experiment and we'll track the data for decades.

Can changing someone's address change their life? The answer to that seems very obvious. But this experiment did not at all go as planned.

This is Planet Money from NPR.

Hello and welcome to Planet Money. I'm Karen Duffin. Today on the show, we are riding a social policy roller coaster. Alongside the researchers who ran this experiment and the people they tested it on, people who were not always excited to be experimented on, it is a quest to make the American dream a reality. A quest that economists thought failed, but is in the midst of an unexpected revival.

Mark and this tiny band of public housing staff leave that conference room, go forth from D.C., and start signing up tenants. The way it worked was this. Tenants from the five chosen cities would be assigned by lottery to one of three groups. Like any good experiment, there would be a control group. This group already lives in public housing and they would stay in public housing.

So no change to group one. Group two would get a regular Section 8 voucher. This is the rent subsidy that they can theoretically use with any landlord who will take it. And group three, this group is the experimental group.

They would also get the Section 8 voucher, but they had to use it to move out to a completely different neighborhood, one where just 10% or less of their neighbors were what the government has classified as poor. For context, most of them had been living in neighborhoods with about 50% poverty. So HUD was asking them to move to what should hopefully be a better neighborhood.

But not everyone was excited about that.

When HUD surveyed families about this, the families said, yes, we do want a voucher, but we want it just because we want to make sure our house is decent and we want to get into a safer neighborhood.

For them, housing was just housing, not opportunity.

The vast majority of people who get vouchers do not use them to move to areas with lower poverty.

Also, Mark and his HUD crew were asking people to participate in a science experiment on themselves, asking them to be living test subjects for a theory they have not proven yet, which is an especially hard thing to take from the federal government, a government that has a history of intentionally segregating people of color into high-poverty neighborhoods. The experiment took years to set up.

But in the end, about 4,600 families were part of it. And in 1994, the moving began. We were not able to talk to the families that moved, but NPR's Morning Edition did cover the study while it was happening. Stevenskeep spoke to a mother named Shirley Hudnall who had moved with her 15-year-old son, Brian. She talked to him about some of the things that do make these kinds of moves hard.

For four years, across the five test cities, people like Shirley moved, and the researchers waited. And in 2008, the researchers finished gathering the data, and what it told them surprised them.

For one thing, moving was better for girls than for boys.

Parents reported better health, something HUD hadn't even originally planned to measure, improved mental health and physical health.

All of which, of course, is wonderful, but this is not what the experiment was designed to test. What they wanted to test was the, quote, long-term housing employment and educational achievements of families involved.

And this massive, scientifically designed and rigorously tested social experiment that had moved thousands of people, just to answer the question, can changing someone's address change the course of their economic life? The answer to that question was no.

Basically, no impact on educational outcomes, employment, or income. If you want to improve those things, the final report said, housing is not your answer. Housing is just housing. And with that, all of the hopes and dollars and research and programs that had been going towards this idea about housing, a lot of that just got rerouted to other ideas. But then this thing happened.

About four years after that final sad MTO data came out, another researcher badged into his government cubicle, this time on the 10th floor of the IRS headquarters in D.C., And like Mark, he wanted to understand how to improve people's economic lives.

This is Nathan Hendren. He's an economist from Harvard. And for a few years, he and some of his research pals had been granted access to tax records at the IRS, with all kinds of privacy restrictions, of course.

Once upon a time, in a cubicle not so far away, sat a government bureaucrat in his government-issued chair preparing for a very big meeting. It was 1994, and Mark Schroeder was an economist at HUD, the Department of Housing and Urban Development, and his team in D.C. had just flown in local public housing authorities from five major cities.

Having that much data allows them to be so much more precise.

Nathan is trying to understand the impact of tax policies on upward mobility, which is economists speak for, can you achieve the American dream? Can a child go from the bottom income bracket to, over time, the top income bracket? And this is an issue that has become increasingly urgent.

Right now, the data says that you are twice as likely to be able to achieve the American dream in Europe, or at least a lot of countries in Europe. So Nathan is looking at tax records from across the country, and he does start seeing a pattern. A pattern that surprised him. That huge MTO study. It looked like it had missed something. Something enormous.

After the break, the experiment that changed everything has to change. Okay, so Nathan Hendren was knee-deep in all of this income tax data at the IRS. alongside his researcher pal Raj Chetty.

They'd seen this data that showed a pattern. People who are rising from the bottom income bracket to the top income bracket aren't just randomly scattered across the country. They're clustered. And your chances of escaping poverty vary widely depending on which cluster you're in. So Nathan digs in deeper. He's starting to look at families who moved into higher mobility neighborhoods.

Like, let's say you have two kids and you move them to this better neighborhood and one of your kids is four when you move and the other one is eight.

Where you live matters for whether you have a shot at achieving the American dream, which sounds terribly obvious. But that contradicts what Moving to Opportunity found, that huge HUD study.

Nathan starts to map income tax data from the actual MTO participants. And this more precise MTO data confirms the pattern that they saw nationally. In fact, the data is so strong that they can say the new neighborhood actually caused the person's economic improvements. That's how much a change of address mattered.

But they also start to realize that it really only mattered for a subset of the MTO participants, only for kids who were younger than 13 years old when they moved. And this explains why HUD missed this outcome. Nathan was looking at the data in 2014. HUD had last looked at this data six years before that, in 2008.

Those younger kids had now grown up, started earning money, started producing income tax data, and they were finally grown up enough now for the data to reveal itself. And what the data was saying was that housing had been hope. Even though they had spent 14 years on this study, they had just counted it out too early.

It's so crazy how just by happenstance, kind of, you guys were studying this at a moment where you could actually see that.

What they found specifically is that kids who move under the age of 13, over time, they earn about 30 percent more.

Teen pregnancies, less likely. The data also seems to indicate that these benefits will probably be passed on to their children. This all did come with a caveat. For kids who are moved when they're older than 13, they earn less over time. The move is actually slightly harmful for that group.

The staff gathers in a basement conference room. It's about 30 people. These are people who run what's now known as the Section 8 Voucher Program, which is a voucher that subsidizes rent for low-income families. It's like a monthly payment to a landlord. Families can wait years on waiting lists just to get one.

But when you look at the younger kids, and over time as they earn more money, they pay more income taxes, and with that, the program actually looks like it pays for itself. So Nathan and his research pals are looking at all of this really exciting data.

They write all this up in a paper, they release it, and then... Overnight, we were inundated.

Did you get a lot of those emails before this? No.

Many of these emails are coming from people who work in public housing who are saying, look, now that we know that this thing works, we should reboot the original HUD program. And Nathan is excited about that prospect, but he does know that if they reboot this, there needs to be an important addition.