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Has the Intergenerational Transmission of Economic Status Changed?

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Author Info
Susan E. Mayer
Leonard Michael Lopoo
Abstract

We use data from the PSID to assess whether the effect of parental income on son's economic status has changed for cohorts born between 1949 and 1965. We find that the effect of parental income on sons' family income and wages at age thirty declined over this period. This was largely because the effect of parental income on son's years of schooling declined. The decline in the effect of parental income is not part of an overall decline in the effect of family background. The effect of parents' education on sons' economic status did not decline and may have increased and the effect of other family background characteristics hardly changed. We suggest that the decline in the effect of parental income on son's income may be due to the increase in government investment in children, especially in their educational attainment.

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Paper provided by Northwestern University/University of Chicago Joint Center for Poverty Research in its series JCPR Working Papers with number 227.

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Date of creation: 18 Jun 2001
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Handle: RePEc:wop:jopovw:227

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  1. Dan Anderberg and Fredrik Andersson, 2003. "Stratification, Social Networks in the Labour Market and Intergenerational Mobility," Royal Holloway, University of London: Discussion Papers in Economics 03/8, Department of Economics, Royal Holloway University of London, revised Dec 2003. [Downloadable!]
    Other versions:
  2. Joseph P. Ferrie, 2005. "The End of American Exceptionalism? Mobility in the U.S. Since 1850," NBER Working Papers 11324, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  3. Jo Blanden & Alissa Goodman & Paul Gregg & Stephen Machin, 2002. "Changes in Intergenerational Mobility in Britain," CEP Discussion Papers dp0517, Centre for Economic Performance, LSE. [Downloadable!]
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  4. David I. Levine & Bhashkar Mazumder, 2003. "The growing importance of family and community: an analysis of changes in the sibling correlation in earnings," Working Paper Series WP-03-24, Federal Reserve Bank of Chicago. [Downloadable!]
  5. John Hassler & Jose V. Rodriguez Mora & Joseph Zeira, 2007. "Inequality and Mobility," ESE Discussion Papers 165, Edinburgh School of Economics, University of Edinburgh. [Downloadable!]
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  6. Harding, David J. & Jencks, Christopher & Lopoo, Leonard M. & Mayer, Susan E., 2003. "The Changing Effect of Family Background on the Incomes of American Adults," Working Paper Series rwp03-045, Harvard University, John F. Kennedy School of Government. [Downloadable!]
  7. Bratberg, Espen & Nilsen, Øivind A. & Vaage, Kjell, 2003. "Assessing Changes in Intergenerational Earnings Mobility," IZA Discussion Papers 797, Institute for the Study of Labor (IZA). [Downloadable!]
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