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Intergenerational Income Mobility in a Less-Developed, High-Inequality Context: The Case of Chile

Listed author(s):
  • Nunez Javier I

    ()

    (University of Chile)

  • Miranda Leslie

    ()

    (University of Chile)

This paper studies the magnitude of intergenerational income mobility in less developed, high inequality Chile. Following a known methodology where fathers' incomes are predicted from standard income determinants such as education and occupation, we get comparable estimates of the intergenerational income elasticity in the range of 0.57 to 0.74 and 0.63 to 0.76 for ages 25-40 and 31-40, respectively. These values place Chile at the high end of the available international evidence. Considering Chile's high income inequality, this finding supports the hypothesis proposed in the literature of an inverse relationship between cross-sectional income inequality and intergenerational income mobility.

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Article provided by De Gruyter in its journal The B.E. Journal of Economic Analysis & Policy.

Volume (Year): 10 (2010)
Issue (Month): 1 (April)
Pages: 1-17

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Handle: RePEc:bpj:bejeap:v:10:y:2010:i:1:n:33
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References listed on IDEAS
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  1. Javier Núñez & Andrea Tartakowsky, 2007. "Inequality of outcomes vs. inequality of opportunities in a developing country. An exploratory analysis for Chile," Estudios de Economia, University of Chile, Department of Economics, vol. 34(2 Year 20), pages 185-202, December.
  2. Grawe, Nathan D., 2006. "Lifecycle bias in estimates of intergenerational earnings persistence," Labour Economics, Elsevier, vol. 13(5), pages 551-570, October.
  3. Murphy, Kevin M & Topel, Robert H, 1985. "Estimation and Inference in Two-Step Econometric Models," Journal of Business & Economic Statistics, American Statistical Association, vol. 3(4), pages 370-379, October.
  4. François Bourguignon & Francisco H. G. Ferreira & Marta Menéndez, 2007. "Inequality Of Opportunity In Brazil," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 53(4), pages 585-618, December.
  5. Arnaud Lefranc & Alain Trannoy, 2005. "Intergenerational earnings mobility in France: Is France more mobile than the U.S.?," Annals of Economics and Statistics, GENES, issue 78, pages 57-77.
  6. Becker, Gary S & Tomes, Nigel, 1979. "An Equilibrium Theory of the Distribution of Income and Intergenerational Mobility," Journal of Political Economy, University of Chicago Press, vol. 87(6), pages 1153-1189, December.
  7. Patrizio Piraino, 2006. "Comparable Estimates of Intergenerational Income Mobility in Italy," Department of Economics University of Siena 471, Department of Economics, University of Siena.
  8. repec:adr:anecst:y:2005:i:78 is not listed on IDEAS
  9. Zimmerman, David J, 1992. "Regression toward Mediocrity in Economic Stature," American Economic Review, American Economic Association, vol. 82(3), pages 409-429, June.
  10. Miles Corak & Andrew Heisz, 1999. "The Intergenerational Earnings and Income Mobility of Canadian Men: Evidence from Longitudinal Income Tax Data," Journal of Human Resources, University of Wisconsin Press, vol. 34(3), pages 504-533.
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  12. Dan Andrews & Andrew Leigh, 2008. "More Inequality, Less Social Mobility," CEPR Discussion Papers 566, Centre for Economic Policy Research, Research School of Economics, Australian National University.
  13. Gary Solon, 2002. "Cross-Country Differences in Intergenerational Earnings Mobility," Journal of Economic Perspectives, American Economic Association, vol. 16(3), pages 59-66, Summer.
  14. Javier Nunez & Andrea Tartakowsky, 2011. "The relationship between income inequality and inequality of opportunities in a high-inequality country: the case of Chile," Applied Economics Letters, Taylor & Francis Journals, vol. 18(4), pages 359-369.
  15. repec:adr:anecst:y:2005:i:78:p:03 is not listed on IDEAS
  16. Corak, Miles, 2006. "Do Poor Children Become Poor Adults? Lessons from a Cross Country Comparison of Generational Earnings Mobility," IZA Discussion Papers 1993, Institute for the Study of Labor (IZA).
  17. Manuel Arellano & Costas Meghir, 1992. "Female Labour Supply and On-the-Job Search: An Empirical Model Estimated Using Complementary Data Sets," Review of Economic Studies, Oxford University Press, vol. 59(3), pages 537-559.
  18. Dunn Christopher E, 2007. "The Intergenerational Transmission of Lifetime Earnings: Evidence from Brazil," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 7(2), pages 1-42, October.
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