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American exceptionalism in a new light: a comparison of intergenerational earnings mobility in the Nordic countries, the United Kingdom and the United States

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Author Info

  • Jäntti, Markus

    ()
    (Department of Economics and Statistics, Ã…bo Akademi University, Finland.)

  • Bratsberg, Bernt

    ()
    (The Ragnar Frisch Centre for Economic Research)

  • Røed, Knut

    ()
    (The Ragnar Frisch Centre for Economic Researc)

  • Raaum, Oddbjørn

    ()
    (The Ragnar Frisch Centre for Economic Researc)

  • Naylor, Robin

    ()
    (University of Warwick, Economics Department)

  • Österbacka, Eva

    ()
    (Ã…bo Akademi University,Department of Economics and Statistics)

  • Bjørklund, Anders

    ()
    (Swedish Institute for Social Research at Stockholm University)

  • Eriksson, Tor

    ()
    (Aarhus School of Business, Department of Economics)

Abstract

We develop methods and employ similar sample restrictions to analyse differences in intergenerational earnings mobility across the United States, the United Kingdom, Denmark, Finland, Norway and Sweden. We examine earnings mobility among pairs of fathers and sons as well as fathers and daughters using both mobility matrices and regression and correlation coefficients. Our results suggest that all countries exhibit substantial earnings persistence across generations, but with statistically significant differences across countries. Mobility is lower in the U.S. than in the U.K., where it is lower again compared to the Nordic countries. Persistence is greatest in the tails of the distributions and tends to be particularly high in the upper tails: though in the U.S. this is reversed with a particularly high likelihood that sons of the poorest fathers will remain in the lowest earnings quintile. This is a challenge to the popular notion of ’American exceptionalism’. The U.S. also differs from the Nordic countries in its very low likelihood that sons of the highest earners will show downward ’long-distance’ mobility into the lowest earnings quintile. In this, the U.K. is more similar to the U.S..

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Bibliographic Info

Paper provided by Oslo University, Department of Economics in its series Memorandum with number 34/2005.

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Length: 44 pages
Date of creation: 25 Dec 2005
Date of revision:
Handle: RePEc:hhs:osloec:2005_034

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Postal: Department of Economics, University of Oslo, P.O Box 1095 Blindern, N-0317 Oslo, Norway
Phone: 22 85 51 27
Fax: 22 85 50 35
Email:
Web page: http://www.oekonomi.uio.no/indexe.html
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Keywords: Intergenerational mobility; earnings inequality; long-run earnings;

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References

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Cited by:
  1. Sara Ayllón, 2009. "Modelling State Dependence and Feedback Effects between Poverty, Employment and Parental Home Emancipation among European Youth," SOEPpapers on Multidisciplinary Panel Data Research 235, DIW Berlin, The German Socio-Economic Panel (SOEP).
  2. Raaum Oddbjørn & Bratsberg Bernt & Røed Knut & Österbacka Eva & Eriksson Tor & Jäntti Markus & Naylor Robin A, 2008. "Marital Sorting, Household Labor Supply, and Intergenerational Earnings Mobility across Countries," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 7(2), pages 1-49, January.
  3. Maarten Van Ham & Allan Findlay & David Manley & Peteke Feijten, 2011. "Social mobility: Is there a benefit of being English in Scotland?," ERSA conference papers ersa10p463, European Regional Science Association.
  4. Richard M. Bird & Eric M. Zolt, 2013. "Taxation and Inequality in the Americas: Changing the Fiscal Contract?," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper1322, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
  5. Siedler, Thomas & Sonnenberg, Bettina, 2012. "Intergenerational Earnings Mobility and Preferences for Redistribution," IZA Discussion Papers 6981, Institute for the Study of Labor (IZA).
  6. Björklund, Anders & Roine, Jesper & Waldenström, Daniel, 2012. "Intergenerational top income mobility in Sweden: Capitalist dynasties in the land of equal opportunity?," Journal of Public Economics, Elsevier, vol. 96(5), pages 474-484.
  7. Napel, Stefan & Schneider, Andrea, 2008. "Intergenerational talent transmission, inequality, and social mobility," Economics Letters, Elsevier, vol. 99(2), pages 405-409, May.
  8. Cardak, Buly A. & Johnston, David W. & Martin, Vance L., 2013. "Intergenerational earnings mobility: A new decomposition of investment and endowment effects," Labour Economics, Elsevier, vol. 24(C), pages 39-47.
  9. Richard Breen, 2010. "Social Mobility and Equality of Opportunity Geary Lecture Spring 2010," The Economic and Social Review, Economic and Social Studies, vol. 41(4), pages 413-428.
  10. Orsetta Causa & Catherine Chapuis, 2009. "Equity in Student Achievement Across OECD Countries: An Investigation of the Role of Policies," OECD Economics Department Working Papers 708, OECD Publishing.
  11. Corak, Miles & Curtis, Lori & Phipps, Shelley, 2010. "Economic Mobility, Family Background, and the Well-Being of Children in the United States and Canada," IZA Discussion Papers 4814, Institute for the Study of Labor (IZA).
  12. Anirudh Krishna, 2011. "Characteristics and Patterns of Intergenerational Poverty Traps and Escapes in Rural North India," Working Papers id:3940, eSocialSciences.
  13. Björklund, Anders & Roine, Jesper & Waldenström, Daniel, 2008. "Intergenerational top income mobility in Sweden – A combination of equal opportunity and capitalistic dynasties," Working Paper Series in Economics and Finance 705, Stockholm School of Economics.
  14. Bratberg, Espen & Rieck, Karsten Marshall Elseth & Vaage, Kjell, 2011. "Intergenerational Earnings Mobility and Divorce," Working Papers in Economics 09/11, University of Bergen, Department of Economics.
  15. Jonsson, Jan O. & Mood, Carina & Bihagen, Erik, 2011. "Poverty in Sweden 1991-2007. Change, dynamics, and intergenerational transmission of poverty during economic recession and growth," Working Paper Series 10/2011, Swedish Institute for Social Research.

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