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Intergenerational Earnings Mobility and the Inheritance of Employers

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  • Corak, Miles

    ()
    (University of Ottawa)

  • Piraino, Patrizio

    ()
    (Statistics Canada)

Abstract

Our analysis of intergenerational earnings mobility modifies the Becker-Tomes model to incorporate the intergenerational transmission of employers, which is predicted to increase the intergenerational elasticity of earnings. About 6% of young Canadian men have the same main employer as their fathers but this is positively related to paternal earnings and rises discretely at the top of the distribution. We use a switching regression model and identify two regimes associated with the inheritance of employers that have different intergenerational earnings elasticities. The model also demonstrates that the inheritance of employers plays a role in understanding observed nonlinearities.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 4876.

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Length: 40 pages
Date of creation: Apr 2010
Date of revision:
Handle: RePEc:iza:izadps:dp4876

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Keywords: intergenerational mobility; job search; networks;

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References

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Citations

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Cited by:
  1. Black, Sandra E. & Devereux, Paul J., 2011. "Recent Developments in Intergenerational Mobility," Handbook of Labor Economics, Elsevier, Elsevier.
  2. Miles Corak & Patrizio Piraino, 2011. "The Intergenerational Transmission of Employers," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 29(1), pages 37-68, 01.
  3. Nordström Skans, Oskar & Kramarz, Francis, 2011. "When strong ties are strong – networks and youth labor market entry," Working Paper Series, IFAU - Institute for Evaluation of Labour Market and Education Policy 2011:18, IFAU - Institute for Evaluation of Labour Market and Education Policy.
  4. 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.
  5. Bingley, Paul & Corak, Miles & Westergård-Nielsen, Niels C., 2011. "The Intergenerational Transmission of Employers in Canada and Denmark," IZA Discussion Papers 5593, Institute for the Study of Labor (IZA).

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