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Dynastic human capital, inequality and intergenerational mobility

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  • Adermon, Adrian

    (IFAU - Institute for Evaluation of Labour Market and Education Policy)

  • Lindahl, Mikael

    (Department of Economics, University of Gothenburg; IFAU; IZA; UCLS; CESifo)

  • Palme, Mårten

    (Department of economics, Stockholm University; IZA)

Abstract

We study the importance of the extended family – or the dynasty – for the persistence in human capital inequality across generations. We use data including the entire Swedish population, linking four generations. This data structure enables us to – in addition to parents, grandparents and great grandparents – identify parents’ siblings and cousins, as well as their spouses, and the spouses’ siblings. We introduce and estimate a new parameter, which we call the intergenerational transmission of dynastic inequality. This parameter measures the between-dynasty variation in intergenerational transmission of human capital. We use three different measures of human capital: years of schooling, family income and an index of occupational status. Our results show that traditional parent-child estimates miss about half of the persistence across generations estimated by the extended model.

Suggested Citation

  • Adermon, Adrian & Lindahl, Mikael & Palme, Mårten, 2016. "Dynastic human capital, inequality and intergenerational mobility," Working Paper Series 2016:19, IFAU - Institute for Evaluation of Labour Market and Education Policy.
    • Handle: RePEc:hhs:ifauwp:2016_019
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    More about this item

    Keywords

    intergenerational mobility; extended family; dynasty; human capital;
    All these keywords.

    JEL classification:

    • I24 - Health, Education, and Welfare - - Education - - - Education and Inequality
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion

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