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Intergenerational Earnings Mobility in Mexico

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  • Nancy A. Daza Báez

    (University College London, Social Research Institute)

Abstract

Intergenerational mobility is a growing concern among academics and policymakers. However, due to the absence of information on earnings for successive generations, little evidence is available for developing countries. This paper adds to this scarce body of evidence by studying intergenerational mobility of earnings for Mexico. I rely on the Two-Sample Two-Stage Least Squares approach to estimate the intergenerational elasticity of earnings and the rank-rank coefficient at the national, urban and regional levels, considering the attenuation and life-cycle biases suffered by the estimators. The key results show less mobility than previously suggested. On average, 70.9% of the relative difference in father's earnings is transmitted to their children. Moreover, a 10 percentile point increase in the father's earnings rank is associated with a 3.15 percentile point increase in the son's earnings rank. At the regional level, strong intergenerational persistence is found in the South; whilst the North presents the highest intergenerational earnings mobility.

Suggested Citation

  • Nancy A. Daza Báez, 2021. "Intergenerational Earnings Mobility in Mexico," DoQSS Working Papers 21-10, Quantitative Social Science - UCL Social Research Institute, University College London.
    • Handle: RePEc:qss:dqsswp:2110
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    Cited by:

    1. Guido Neidhöfer & Leonardo Gasparini & Matias Ciaschi, "undated". "Intergenerational mobility of economic well-being in Latin America," Working Papers 620, ECINEQ, Society for the Study of Economic Inequality.
    2. Paolo Brunori & Francisco H.G. Ferreira & Guido Neidhöfer, 2023. "Inequality of opportunity and intergenerational persistence in Latin America," WIDER Working Paper Series wp-2023-39, World Institute for Development Economic Research (UNU-WIDER).

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    More about this item

    Keywords

    Inequality; Intergenerational earnings mobility; Rank-rank coefficient; Two-Sample Two-Stage Least Squares; Mexico;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion
    • C20 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - General

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