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Intergenerational Transmission of Economic Strain and High School Dropout

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  • Ana I. Moro Egido

    (Department of Economic Theory and Economic History, University of Granada.)

  • Maria Navarro

    (Departament of Applied Economics, University of Granada.)

Abstract

In this paper, we evaluate the role of parental financial difficulties in the intergenerational transmission of material deprivation. To this end, we use data from the specific module ’Intergenerational transmission of disadvantages’ included in the EU-SILC survey for the years 2005, 2011 and 2019. Our contribution relies on the distinction between the direct effect of parental difficulties on adults’ material deprivation (intergenerational transmission) and the indirect effect through educational achievement (particularly high school dropouts). Our findings suggest that, as expected, parental financial difficulties increase the probability of dropping out (indirect effect), which in turn increases their children’s intensity of household material deprivation in adulthood. The intergenerational link exists and is stronger for early leavers (direct effect). The mechanisms behind these results are lone parenthood, non-highly educated mothers and non-working fathers. We also find that intergenerational transmission differs by country characteristics. More specifically, the poorer and less equal the country, the stronger the intergenerational link. Our results highlight the importance of childhood interventions as an additional channel to correct for material deprivation in adulthood and, in general, to tackle the inequality of opportunity and intergenerational poverty.

Suggested Citation

  • Ana I. Moro Egido & Maria Navarro, 2023. "Intergenerational Transmission of Economic Strain and High School Dropout," ThE Papers 23/07, Department of Economic Theory and Economic History of the University of Granada..
    • Handle: RePEc:gra:wpaper:23/07
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    File URL: http://www.ugr.es/~teoriahe/RePEc/gra/wpaper/thepapers23_07.pdf
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    More about this item

    Keywords

    Intergenerational transmission; material deprivation; parental economic strain; high school dropouts.;
    All these keywords.

    JEL classification:

    • C31 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models; Quantile Regressions; Social Interaction Models
    • I24 - Health, Education, and Welfare - - Education - - - Education and Inequality
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty

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