Social Mobility in Western Countries: The Role of Families, Networks, and Institutions

This chapter reviews recent advances on the drivers of intergenerational persistence in education and income, with a focus on causal mechanisms shaping social mobility across OECD countries. While the descriptive literature is vast, documenting substantial correlations between parents' and children's outcomes, recent research increasingly emphasizes the underlying factors driving these patterns. We begin with a brief illustration of global variation in intergenerational mobility using harmonized cross-country data, before turning to the literature on mechanisms. We outline a general theoretical framework, which organizes the discussion around three domains: pre-market factors (e.g., early childhood investment, parenting, education systems), labor market dynamics (e.g., sorting, networks, firm heterogeneity), and post-market institutions. We review topics such as the timing and nature of parental investments, parenting styles, credit constraints, neighborhood effects, and the role of social networks in school and on the labor market. We highlight how new data and empirical designs have broadened our understanding of the drivers of intergenerational inequality and, ultimately, interventions with the potential to mitigate it.