IDEAS home Printed from https://ideas.repec.org/a/eee/labeco/v77y2022ics0927537121000348.html
   My bibliography  Save this article

Lessons for Americans from Denmark about inequality and social mobility

Author

Abstract

Many progressive American policy analysts point to Denmark as a model welfare state with low levels of income inequality and high levels of income mobility across generations. It has in place many social policies now advocated for adoption in the U.S. Despite generous Danish social policies, family influence on important child outcomes in Denmark is about as strong as it is in the United States. More advantaged families are better able to access, utilize, and influence universally available programs. Purposive sorting by levels of family advantage create neighborhood effects. Powerful forces not easily mitigated by Danish-style welfare state programs operate in both countries.

Suggested Citation

  • Heckman, James & Landersø, Rasmus, 2022. "Lessons for Americans from Denmark about inequality and social mobility," Labour Economics, Elsevier, vol. 77(C).
    • Handle: RePEc:eee:labeco:v:77:y:2022:i:c:s0927537121000348
    DOI: 10.1016/j.labeco.2021.101999
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0927537121000348
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.labeco.2021.101999?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Anthony B. Atkinson & Jakob Egholt Søgaard, 2016. "The Long-Run History of Income Inequality in Denmark," Scandinavian Journal of Economics, Wiley Blackwell, vol. 118(2), pages 264-291, April.
    2. Magne Mogstad & Joseph P. Romano & Azeem Shaikh & Daniel Wilhelm, 2020. "Inference for Ranks with Applications to Mobility across Neighborhoods and Academic Achievement across Countries," NBER Working Papers 26883, National Bureau of Economic Research, Inc.
    3. Rasmus Landersø & James J. Heckman, 2017. "The Scandinavian Fantasy: Sources of Intergenerational Mobility in Denmark and the US," Scandinavian Journal of Economics, Wiley Blackwell, vol. 119(1), pages 178-230, January.
    4. Raj Chetty & Nathaniel Hendren, 2018. "The Impacts of Neighborhoods on Intergenerational Mobility I: Childhood Exposure Effects," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 133(3), pages 1107-1162.
    5. Raj Chetty & Nathaniel Hendren & Maggie R Jones & Sonya R Porter, 2020. "Race and Economic Opportunity in the United States: an Intergenerational Perspective [“Intergenerational Mobility of Immigrants in the US Over Two Centuries,”]," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 135(2), pages 711-783.
    6. Jacob A. Mincer, 1974. "Introduction to "Schooling, Experience, and Earnings"," NBER Chapters, in: Schooling, Experience, and Earnings, pages 1-4, National Bureau of Economic Research, Inc.
    7. Miles Corak, 2013. "Income Inequality, Equality of Opportunity, and Intergenerational Mobility," Journal of Economic Perspectives, American Economic Association, vol. 27(3), pages 79-102, Summer.
    8. Sean F. Reardon & Kendra Bischoff & Ann Owens & Joseph B. Townsend, 2018. "Has Income Segregation Really Increased? Bias and Bias Correction in Sample-Based Segregation Estimates," Demography, Springer;Population Association of America (PAA), vol. 55(6), pages 2129-2160, December.
    9. Maia Güell & Michele Pellizzari & Giovanni Pica & José V. Rodríguez Mora, 2018. "Correlating Social Mobility and Economic Outcomes," Economic Journal, Royal Economic Society, vol. 128(612), pages 353-403, July.
    10. James J. Heckman & Stefano Mosso, 2014. "The Economics of Human Development and Social Mobility," Annual Review of Economics, Annual Reviews, vol. 6(1), pages 689-733, August.
    11. Raj Chetty, 2021. "Improving Equality Of Opportunity: New Insights From Big Data," Contemporary Economic Policy, Western Economic Association International, vol. 39(1), pages 7-41, January.
    12. Jacob A. Mincer, 1974. "Schooling, Experience, and Earnings," NBER Books, National Bureau of Economic Research, Inc, number minc74-1, March.
    13. Peter Bergman & Raj Chetty & Stefanie DeLuca & Nathaniel Hendren & Lawrence F. Katz & Christopher Palmer, 2019. "Creating Moves to Opportunity: Experimental Evidence on Barriers to Neighborhood Choice," NBER Working Papers 26164, National Bureau of Economic Research, Inc.
    14. Bhashkar Mazumder, 2008. "Does education improve health? A reexamination of the evidence from compulsory schooling laws," Economic Perspectives, Federal Reserve Bank of Chicago, vol. 32(Q II), pages 2-16.
    15. Cunha, Flavio & Heckman, James J. & Lochner, Lance, 2006. "Interpreting the Evidence on Life Cycle Skill Formation," Handbook of the Economics of Education, in: Erik Hanushek & F. Welch (ed.), Handbook of the Economics of Education, edition 1, volume 1, chapter 12, pages 697-812, Elsevier.
    16. Christopher R. Walters, 2018. "The Demand for Effective Charter Schools," Journal of Political Economy, University of Chicago Press, vol. 126(6), pages 2179-2223.
    17. Milton Friedman, 1957. "A Theory of the Consumption Function," NBER Books, National Bureau of Economic Research, Inc, number frie57-1, March.
    18. Douglas Almond & Janet Currie, 2011. "Killing Me Softly: The Fetal Origins Hypothesis," Journal of Economic Perspectives, American Economic Association, vol. 25(3), pages 153-172, Summer.
    19. Havnes, Tarjei & Mogstad, Magne, 2015. "Is universal child care leveling the playing field?," Journal of Public Economics, Elsevier, vol. 127(C), pages 100-114.
    20. Raj Chetty & John N. Friedman & Nathaniel Hendren & Maggie R. Jones & Sonya R. Porter, 2018. "The Opportunity Atlas: Mapping the Childhood Roots of Social Mobility," Working Papers 18-42, Center for Economic Studies, U.S. Census Bureau.
    21. Helena Skyt Nielsen & Torben Sørensen & Christopher Taber, 2010. "Estimating the Effect of Student Aid on College Enrollment: Evidence from a Government Grant Policy Reform," NBER Chapters, in: Income Taxation, Trans-Atlantic Public Economics Seminar (TAPES), pages 185-215, National Bureau of Economic Research, Inc.
    22. Stephen V. Cameron & James J. Heckman, 1998. "Life Cycle Schooling and Dynamic Selection Bias: Models and Evidence for Five Cohorts of American Males," Journal of Political Economy, University of Chicago Press, vol. 106(2), pages 262-333, April.
    23. Almond, Douglas & Currie, Janet, 2011. "Human Capital Development before Age Five," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 4, chapter 15, pages 1315-1486, Elsevier.
    24. Milton Friedman, 1957. "Introduction to "A Theory of the Consumption Function"," NBER Chapters, in: A Theory of the Consumption Function, pages 1-6, National Bureau of Economic Research, Inc.
    25. Pedro Carneiro & Italo López García & Kjell G. Salvanes & Emma Tominey, 2021. "Intergenerational Mobility and the Timing of Parental Income," Journal of Political Economy, University of Chicago Press, vol. 129(3), pages 757-788.
    26. Chul-In Lee & Gary Solon, 2009. "Trends in Intergenerational Income Mobility," The Review of Economics and Statistics, MIT Press, vol. 91(4), pages 766-772, November.
    27. Martin Browning & S¯ren Leth-Petersen, 2003. "Imputing consumption from income and wealth information," Economic Journal, Royal Economic Society, vol. 113(488), pages 282-301, June.
    28. Stephen V. Cameron & James J. Heckman, 1998. "Life Cycle Schooling and Dynamic Selection Bias: Models and Evidence for Five Cohorts," NBER Working Papers 6385, National Bureau of Economic Research, Inc.
    29. Tarjei Havnes & Magne Mogstad, 2011. "No Child Left Behind: Subsidized Child Care and Children's Long-Run Outcomes," American Economic Journal: Economic Policy, American Economic Association, vol. 3(2), pages 97-129, May.
    30. Karlson, Kristian B. & Landerso, Rasmus, 2021. "The Making and Unmaking of Opportunity: Educational Mobility in 20th Century-Denmark," IZA Discussion Papers 14135, Institute of Labor Economics (IZA).
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Zhang, Xinmiao & Deguilhem, Thibaud, 2022. "Climbing the Social Ladder: Does Intergenerational Solidarity matter?," MPRA Paper 115241, University Library of Munich, Germany.
    2. Dora Costa & CoraLee Lewis & Noelle Yetter, 2022. "Children and Grandchildren of Union Army Veterans: New Data Collections to Study the Persistence of Longevity and Socioeconomic Status Across Generations," NBER Working Papers 30747, National Bureau of Economic Research, Inc.
    3. Eshaghnia, Sadegh S. M. & Heckman, James J. & Razavi, Goya, 2023. "Pricing Neighborhoods," IZA Discussion Papers 16234, Institute of Labor Economics (IZA).
    4. Foged, Mette & Hasager, Linea & Peri, Giovanni & Arendt, Jacob Nielsen & Bolvig, Iben, 2023. "Intergenerational spillover effects of language training for refugees," Journal of Public Economics, Elsevier, vol. 220(C).
    5. Fjaellegaard Jensen, Mathias & Manning, Alan, 2022. "Background matters, but not whether parents are immigrants: outcomes of children born in Denmark," LSE Research Online Documents on Economics 118005, London School of Economics and Political Science, LSE Library.
    6. Trung V Vu, 2023. "Long-term relatedness and income distribution: understanding the deep roots of inequality," Oxford Economic Papers, Oxford University Press, vol. 75(3), pages 704-728.
    7. Hirshman, Samuel D. & Willén, Alexander, 2022. "Does Increasing Risk Widen Gender Gaps?," Discussion Paper Series in Economics 20/2022, Norwegian School of Economics, Department of Economics.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Heckman, James J. & Landerso, Rasmus, 2021. "Lessons from Denmark about Inequality and Social Mobility," IZA Discussion Papers 14185, Institute of Labor Economics (IZA).
    2. Andros Kourtellos & Chih Ming Tan & Steven N. Durlauf, 2022. "The Great Gatsby Curve," Annual Review of Economics, Annual Reviews, vol. 14(1), pages 571-605, August.
    3. Hideo Akabayashi & TIm Ruberg & Chizuru Shikishima & Jun Yamashita, 2023. "Education-Oriented and Care-Oriented Preschools:Implications on Child Development," Keio-IES Discussion Paper Series 2023-009, Institute for Economics Studies, Keio University.
    4. Akabayashi, Hideo & Ruberg, Tim & Shikishima, Chizuru & Yamashita, Jun, 2023. "Education-oriented and care-oriented preschools: Implications on child development," Labour Economics, Elsevier, vol. 84(C).
    5. Hennig, Jan-Luca, 2021. "Labor Market Polarization and Intergenerational Mobility: Theory and Evidence," VfS Annual Conference 2021 (Virtual Conference): Climate Economics 242353, Verein für Socialpolitik / German Economic Association.
    6. George Bulman & Robert Fairlie & Sarena Goodman & Adam Isen, 2021. "Parental Resources and College Attendance: Evidence from Lottery Wins," American Economic Review, American Economic Association, vol. 111(4), pages 1201-1240, April.
    7. James Heckman & Flavio Cunha, 2007. "The Technology of Skill Formation," American Economic Review, American Economic Association, vol. 97(2), pages 31-47, May.
    8. Elizabeth M. Caucutt & Lance Lochner, 2020. "Early and Late Human Capital Investments, Borrowing Constraints, and the Family," Journal of Political Economy, University of Chicago Press, vol. 128(3), pages 1065-1147.
    9. Huebener, Mathias & Kuehnle, Daniel & Spiess, C. Katharina, 2019. "Parental leave policies and socio-economic gaps in child development: Evidence from a substantial benefit reform using administrative data," Labour Economics, Elsevier, vol. 61(C).
    10. Veronika V. Eberharter, 2018. "Capability Deprivation, and the Intergenerational Transmission of Social Disadvantages—Empirical Evidence from Selected Countries," Social Sciences, MDPI, vol. 7(12), pages 1-22, December.
    11. Markussen, Simen & Røed, Knut, 2017. "Egalitarianism under Pressure: Toward Lower Economic Mobility in the Knowledge Economy?," IZA Discussion Papers 10664, Institute of Labor Economics (IZA).
    12. Zhang, Xinmiao & Deguilhem, Thibaud, 2022. "Climbing the Social Ladder: Does Intergenerational Solidarity matter?," MPRA Paper 115241, University Library of Munich, Germany.
    13. Richard J. Murnane, 2013. "U.S. High School Graduation Rates: Patterns and Explanations," Journal of Economic Literature, American Economic Association, vol. 51(2), pages 370-422, June.
    14. Juanna Schrøter Joensen, 2010. "Timing and Incentives: Impacts of Student Aid on Academic Achievement," 2010 Meeting Papers 823, Society for Economic Dynamics.
    15. Elizabeth M. Caucutt & Lance Lochner & Youngmin Park, 2017. "Correlation, Consumption, Confusion, or Constraints: Why Do Poor Children Perform so Poorly?," Scandinavian Journal of Economics, Wiley Blackwell, vol. 119(1), pages 102-147, January.
    16. Bram Wouterse & Karen Wiel & Marc Steeg, 2017. "Income Differences Between PhDs and Masters: Evidence from The Netherlands," De Economist, Springer, vol. 165(4), pages 439-461, December.
    17. Guido Neidhöfer, 2019. "Intergenerational mobility and the rise and fall of inequality: Lessons from Latin America," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 17(4), pages 499-520, December.
    18. Jorge Luis García & James J. Heckman, 2022. "Parenting Promotes Social Mobility Within and Across Generations," NBER Working Papers 30610, National Bureau of Economic Research, Inc.
    19. Giesecke, Matthias & Bönke, Timm & Lüthen, Holger, 2011. "The Dynamics of Earnings in Germany: Evidence from Social Security Records," VfS Annual Conference 2011 (Frankfurt, Main): The Order of the World Economy - Lessons from the Crisis 48692, Verein für Socialpolitik / German Economic Association.
    20. Steven J. Haider & Kathleen McGarry, 2018. "Postsecondary Schooling and Parental Resources: Evidence from the PSID and HRS," Education Finance and Policy, MIT Press, vol. 13(1), pages 72-96, Winter.

    More about this item

    Keywords

    Inequality; Social mobility; Family influence; Power of place;
    All these keywords.

    JEL classification:

    • H44 - Public Economics - - Publicly Provided Goods - - - Publicly Provided Goods: Mixed Markets
    • H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
    • J12 - Labor and Demographic Economics - - Demographic Economics - - - Marriage; Marital Dissolution; Family Structure
    • J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:labeco:v:77:y:2022:i:c:s0927537121000348. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/labeco .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.