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Temporal and Regional Variation in Intergenerational Income Mobility in New Zealand

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  • Ryan Greenaway-McGrevy
  • Yun So

Abstract

This paper documents variation in intergenerational income mobility (IIM) over time and between different regions of New Zealand. Our sample is a cohort of males born between 1963 and 1982 that reached adulthood over a period spanning the policy reforms of the 1980s. We show that the intergenerational elasticity of income (IGE) measure of IIM is higher for men born later in the sample, suggesting that IIM has decreased over the period of rising income inequality following the reforms. To more closely examine the statistical association between income inequality and IIM, we exploit spatiotemporal variation in IGE estimates and Gini coefficients to show that growing up in regions or periods in which there is higher income inequality is associated with lower IIM. Although these results do not imply causality, they are consistent with an international literature that establishes a statistical association between income inequality and IIM.

Suggested Citation

  • Ryan Greenaway-McGrevy & Yun So, 2024. "Temporal and Regional Variation in Intergenerational Income Mobility in New Zealand," Working Papers 022, University of Auckland, Economic Policy Center (EPC).
    • Handle: RePEc:cyc:wpaper:022
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    Keywords

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    JEL classification:

    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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