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Intergenerational Income Mobility in Urban China

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  • Gong, Cathy Honge

    (University of Canberra)

  • Leigh, Andrew

    (Parliament of Australia)

  • Meng, Xin

    (Australian National University)

Abstract

This paper estimates the intergenerational income elasticity for urban China, paying careful attention to the potential biases induced by income fluctuations and life cycle effects. Our preferred estimates are that the intergenerational income elasticities are 0.74 for father-son, 0.84 for father-daughter, 0.33 for mother-son, and 0.47 for mother-daughter. This suggests that while China has experienced rapid growth of absolute incomes, the relative position of children in the distribution is largely determined by their parents’ incomes. Investigating possible causal channels, we find that parental education, occupation, and Communist Party membership all play important roles in transmitting economic status from parents to children.

Suggested Citation

  • Gong, Cathy Honge & Leigh, Andrew & Meng, Xin, 2010. "Intergenerational Income Mobility in Urban China," IZA Discussion Papers 4811, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp4811
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    More about this item

    Keywords

    political party membership; transgenerational persistence; intergenerational mobility;
    All these keywords.

    JEL classification:

    • D10 - Microeconomics - - Household Behavior - - - General
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution

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