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Love and Money: Intergenerational Mobility and Marital Matching on Parental Income

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  • Blanden, Joanne

Abstract

This paper makes use of matched tax-return data for daughters, their parents, their partners and their partners' parents to investigate the interactions between intergenerational mobility and marital matching for young couples in Canada. We show how assortative mating contributes to intergenerational household income persistence. The strength of the association between sons-in-law's income and women's parental income means that the intergenerational link between household incomes is stronger than that found for daughters' own incomes alone. This is also the case when viewed from the other side, so that daughters' and their partners' earnings are related to partners' parental income. These results indicate that assortative matching magnifies individual-level intergenerational persistence. In the second part of the paper we consider assortative mating by parental income. We find that daughter's parental income has an elasticity of almost 0.2 with respect to her partner's parental income. This association is of approximately the same magnitude as the intergenerational link between parents' and children's incomes. We investigate variations in the correlation between the parental incomes across several measured dimensions; cohabiting couples have lower correlations, as do those who form partnerships early, those who live in rural areas and most interestingly, those who later divorce. We interpret this last result as evidence that, on average, couples with parental incomes that are more similar enjoy a more stable match.

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Bibliographic Info

Paper provided by Statistics Canada, Analytical Studies Branch in its series Analytical Studies Branch Research Paper Series with number 2005272e.

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Date of creation: 08 Dec 2005
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Handle: RePEc:stc:stcp3e:2005272e

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Related research

Keywords: Families; households and housing; Family history; Household; family and personal income; Income; pensions; spending and wealth;

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References

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  8. Lam, D. & Schoeni, R.F., 1993. "Family Ties and Labor Markets in the United States and Brazil," Papers 93-25, RAND - Labor and Population Program.
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  12. Steven Haider & Gary Solon, 2006. "Life-Cycle Variation in the Association between Current and Lifetime Earnings," NBER Working Papers 11943, National Bureau of Economic Research, Inc.
  13. Burdett, Ken & Coles, Melvyn G, 1997. "Marriage and Class," The Quarterly Journal of Economics, MIT Press, vol. 112(1), pages 141-68, February.
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  16. Ermisch, John & Francesconi, Marco, 2002. "Intergenerational Social Mobility and Assortative Mating in Britain," IZA Discussion Papers 465, Institute for the Study of Labor (IZA).
  17. Miles Corak & Andrew Heisz, 1998. "The Intergenerational Earnings and Income Mobility of Canadian," Labor and Demography 9808001, EconWPA.
  18. Ermisch, John & Francesconi, Marco & Siedler, Thomas, 2005. "Intergenerational Economic Mobility and Assortative Mating," IZA Discussion Papers 1847, Institute for the Study of Labor (IZA).
  19. Burdett, Kenneth & Coles, Melvyn G, 1999. "Long-Term Partnership Formation: Marriage and Employment," Economic Journal, Royal Economic Society, vol. 109(456), pages F307-34, June.
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Cited by:
  1. Corak, Miles & Piraino, Patrizio, 2010. "Intergenerational Earnings Mobility and the Inheritance of Employers," IZA Discussion Papers 4876, Institute for the Study of Labor (IZA).
  2. Helena Holmlund, 2008. "Intergenerational Mobility and Assortative Mating: Effects of an Educational Reform," CEE Discussion Papers 0091, Centre for the Economics of Education, LSE.
  3. Corak, Miles & Piraino, Patrizio, 2010. "The Intergenerational Transmission of Employers," IZA Discussion Papers 4819, Institute for the Study of Labor (IZA).

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