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Aspirations, Segregation and Occupational Choice

Author

Listed:
  • Dilip Mookherjee

    () (Boston University)

  • Stefan Napel

    (University of Bayreuth)

  • Debraj Ray

    (New York University)

Abstract

This paper examines steady states of an overlapping generations economy with a given distribution of household locations over a one-dimensional interval. Parents decide whether or not to educate their children. Such decisions are a ected by location: parental aspirations depend on the earnings of their neighbors. At the same time, economy-wide wages endogenously adjust to bring factor supplies into line with demand. The model therefore combines local social interaction with global market interaction. The paper studies steadystate configurations of skill acquisition, both with and without segregation, and studies the macroeconomic and welfare effects of segregation on aggregate economic outcomes.

Suggested Citation

  • Dilip Mookherjee & Stefan Napel & Debraj Ray, 2008. "Aspirations, Segregation and Occupational Choice," Boston University - Department of Economics - The Institute for Economic Development Working Papers Series dp-182, Boston University - Department of Economics.
  • Handle: RePEc:bos:iedwpr:dp-182
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    File URL: http://www.bu.edu/econ/ied/dp/papers/dp%20182.pdf
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    References listed on IDEAS

    as
    1. Mookherjee, Dilip & Napel, Stefan, 2007. "Intergenerational mobility and macroeconomic history dependence," Journal of Economic Theory, Elsevier, vol. 137(1), pages 49-78, November.
    2. Oded Galor & Joseph Zeira, 1993. "Income Distribution and Macroeconomics," Review of Economic Studies, Oxford University Press, vol. 60(1), pages 35-52.
    3. Dilip Mookherjee & Stefan Napel & Debraj Ray, 2010. "Aspirations, Segregation, and Occupational Choice," Journal of the European Economic Association, MIT Press, vol. 8(1), pages 139-168, March.
    4. Napel, Stefan & Schneider, Andrea, 2008. "Intergenerational talent transmission, inequality, and social mobility," Economics Letters, Elsevier, vol. 99(2), pages 405-409, May.
    5. Pancs, Romans & Vriend, Nicolaas J., 2007. "Schelling's spatial proximity model of segregation revisited," Journal of Public Economics, Elsevier, vol. 91(1-2), pages 1-24, February.
    6. Roland Benabou, 1993. "Workings of a City: Location, Education, and Production," The Quarterly Journal of Economics, Oxford University Press, vol. 108(3), pages 619-652.
    7. Raquel Fernández & Richard Rogerson, 2001. "Sorting and Long-Run Inequality," The Quarterly Journal of Economics, Oxford University Press, vol. 116(4), pages 1305-1341.
    8. George A. Akerlof & Rachel E. Kranton, 2000. "Economics and Identity," The Quarterly Journal of Economics, Oxford University Press, vol. 115(3), pages 715-753.
    9. Christian Ghiglino & Sanjeev Goyal, 2010. "Keeping Up with the Neighbors: Social Interaction in a Market Economy," Journal of the European Economic Association, MIT Press, vol. 8(1), pages 90-119, March.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Pasquier-Doumer, Laure & Risso Brandon, Fiorella, 2015. "Aspiration Failure: A Poverty Trap for Indigenous Children in Peru?," World Development, Elsevier, vol. 72(C), pages 208-223.
    2. Christian Ghiglino & Sanjeev Goyal, 2010. "Keeping Up with the Neighbors: Social Interaction in a Market Economy," Journal of the European Economic Association, MIT Press, vol. 8(1), pages 90-119, 03.
    3. repec:eee:jeborg:v:139:y:2017:i:c:p:1-25 is not listed on IDEAS
    4. Dilip Mookherjee & Stefan Napel & Debraj Ray, 2010. "Aspirations, Segregation, and Occupational Choice," Journal of the European Economic Association, MIT Press, vol. 8(1), pages 139-168, March.
    5. Tiago V. V. Cavalcanti & Chryssi Giannitsarou, 2017. "Growth and Human Capital: A Network Approach," Economic Journal, Royal Economic Society, vol. 127(603), pages 1279-1317, August.
    6. Dibyendu S. Maiti & Arup Mitra, 2010. "Skills, Informality and Development," Working Papers id:3115, eSocialSciences.
    7. Mariana Pereira-López & Isidro Soloaga, 2015. "External returns to higher education in Mexico 2000-2010," Ensayos Revista de Economia, Universidad Autonoma de Nuevo Leon, Facultad de Economia, vol. 0(1), pages 1-34, May.
    8. Chiapa, Carlos & Garrido, José Luis & Prina, Silvia, 2012. "The effect of social programs and exposure to professionals on the educational aspirations of the poor," Economics of Education Review, Elsevier, vol. 31(5), pages 778-798.
    9. Tommaso Gabrieli, 2016. "Spatial Segregation, Redistribution and Welfare: A Theoretical Model," Urban Planning, Cogitatio Press, vol. 1(1), pages 68-78.
    10. Koczan, Zs, 2013. "Does identity matter," Cambridge Working Papers in Economics 1313, Faculty of Economics, University of Cambridge.
    11. Marcus Böhme, 2015. "Migration and educational aspirations – Another channel of brain gain?," IZA Journal of Migration and Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 4(1), pages 1-24, December.
    12. Berardino Cesi & Dimitri Paolini, 2014. "Peer Group and Distance: When Widening University Participation is Better," Manchester School, University of Manchester, vol. 82, pages 110-132, December.
    13. Chivers, David, 2017. "Success, survive or escape? Aspirations and poverty traps," Journal of Economic Behavior & Organization, Elsevier, vol. 143(C), pages 116-132.

    More about this item

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation

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