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The intergenerational persistence of human capital: an empirical analysis of four generations

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Author Info

  • Lindahl, Mikael

    ()
    (Department of Economics, Uppsala University)

  • Palme, Mårten

    ()
    (Department of Economics, Stockholm University)

  • Sandgren Massih, Sofia

    (Department of Economics, Uppsala University)

  • Sjögren, Anna

    ()
    (IFAU - Institute for Evaluation of Labour Market and Education Policy)

Abstract

Most previous studies of intergenerational transmission of human capital are restricted to two generations – parents and their children. In this study we use a Swedish data set which enables us link individual measures of lifetime earnings for three generations and data on educational attainments of four generations. We investigate to what extent estimates based on income data from two generations accurately predicts earnings persistence beyond two generations. We also do a similar analysis for intergenerational persistence in educational attainments. We find two-generation studies to severely under-predict intergenerational persistence in earnings and educational attainment over three generations. Finally, we use our multigenerational data on educational attainment to estimate the structural parameters in the Becker-Tomes model. Our results suggest a small or no causal effect of parental education on children’s educational attainment.

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Bibliographic Info

Paper provided by IFAU - Institute for Evaluation of Labour Market and Education Policy in its series Working Paper Series with number 2012:12.

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Length: 30 pages
Date of creation: 08 Jun 2012
Date of revision:
Publication status: Published as Lindahl, Mikael, Mårten Palme, Sofia Sandgren Massih and Anna Sjögren, 'A test of the Becker-Tomes model of human capital transmission using microdata on four generations' in Journal of Human Capital , 2014, pages 80-96.
Handle: RePEc:hhs:ifauwp:2012_012

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Postal: IFAU, P O Box 513, SE-751 20 Uppsala, Sweden
Phone: (+46) 18 - 471 70 70
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Keywords: Intergenerational income mobility; Human capital transmission; Multigenerational income mobility;

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References

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  1. Rolf Aaberge & Magne Mogstad & Vito Peragine, 2010. "Measuring long-term inequality of opportunity," Working Papers 158, ECINEQ, Society for the Study of Economic Inequality.
  2. Galor, Oded & Zeira, Joseph, 1993. "Income Distribution and Macroeconomics," Review of Economic Studies, Wiley Blackwell, vol. 60(1), pages 35-52, January.
  3. Holmlund, Helena & Lindahl, Mikael & Plug, Erik, 2008. "The Causal Effect of Parent's Schooling on Children's Schooling: A Comparison of Estimation Methods," IZA Discussion Papers 3630, Institute for the Study of Labor (IZA).
  4. Lefgren, Lars & Lindquist, Matthew & Sims, David, 2009. "Rich Dad, Smart Dad: Decomposing the Intergenerational Transmission of Income," Research Papers in Economics 2009:19, Stockholm University, Department of Economics.
  5. Gary S. Becker & Kevin M. Murphy & Robert Tamura, 1994. "Human Capital, Fertility, and Economic Growth," NBER Chapters, in: Human Capital: A Theoretical and Empirical Analysis with Special Reference to Education (3rd Edition), pages 323-350 National Bureau of Economic Research, Inc.
  6. Björklund, Anders & Lindahl, Mikael & Plug, Erik, 2005. "The Origins of Intergenerational Associations: Lessons from Swedish Adoption Data," IZA Discussion Papers 1739, Institute for the Study of Labor (IZA).
  7. Sandra E. Black & Paul J. Devereux & Kjell G. Salvanes, 2005. "The More the Merrier? The Effect of Family Size and Birth Order on Children's Education," The Quarterly Journal of Economics, MIT Press, vol. 120(2), pages 669-700, May.
  8. Black, Sandra & Devereux, Paul J., 2010. "Recent Developments in Intergenerational Mobility," CEPR Discussion Papers 7786, C.E.P.R. Discussion Papers.
  9. Anders Bohlmark & Matthew J. Lindquist, 2006. "Life-Cycle Variations in the Association between Current and Lifetime Income: Replication and Extension for Sweden," Journal of Labor Economics, University of Chicago Press, vol. 24(4), pages 879-900, October.
  10. Maurin, Eric, 2002. "The impact of parental income on early schooling transitions: A re-examination using data over three generations," Journal of Public Economics, Elsevier, vol. 85(3), pages 301-332, September.
  11. Bruce Sacerdote, 2004. "What Happens When We Randomly Assign Children to Families?," NBER Working Papers 10894, National Bureau of Economic Research, Inc.
  12. María Sáez-Martí & Anna Sjögren, 2008. "Peers and Culture," Scandinavian Journal of Economics, Wiley Blackwell, vol. 110(1), pages 73-92, 03.
  13. Daniele Checchi & Vito Peragine, 2010. "Inequality of opportunity in Italy," Journal of Economic Inequality, Springer, vol. 8(4), pages 429-450, December.
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Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. Sverige: det jämlika klassamhället?
    by Jonas Vlachos in Ekonomistas on 2012-12-21 12:29:36
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Cited by:
  1. Richter, André & Robling, Per Olof, 2013. "Multigenerational e ffects of the 1918-19 influenza pandemic in Sweden," Working Paper Series 5/2013, Swedish Institute for Social Research.
  2. Gary Solon, 2013. "Theoretical Models of Inequality Transmission across Multiple Generations," NBER Working Papers 18790, National Bureau of Economic Research, Inc.
  3. Patrizio Piraino & Sean Muller & Jeanne Cilliers & Johan Fourie, 2013. "The transmission of longevity across generations: The case of the settler Cape Colony," Working Papers 14/2013, Stellenbosch University, Department of Economics.
  4. Stuhler, Jan, 2012. "Mobility Across Multiple Generations: The Iterated Regression Fallacy," IZA Discussion Papers 7072, Institute for the Study of Labor (IZA).

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