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American exceptionalism in a new light: a comparison of intergenerational earnings mobility in the Nordic countries, the United Kingdom and the United States

  • Jäntti, Markus

    ()

    (Department of Economics and Statistics, Ã…bo Akademi University, Finland.)

  • Bratsberg, Bernt

    ()

    (The Ragnar Frisch Centre for Economic Research)

  • Røed, Knut

    ()

    (The Ragnar Frisch Centre for Economic Researc)

  • Raaum, Oddbjørn

    ()

    (The Ragnar Frisch Centre for Economic Researc)

  • Naylor, Robin

    ()

    (University of Warwick, Economics Department)

  • Österbacka, Eva

    ()

    (Ã…bo Akademi University,Department of Economics and Statistics)

  • Bjørklund, Anders

    ()

    (Swedish Institute for Social Research at Stockholm University)

  • Eriksson, Tor

    ()

    (Aarhus School of Business, Department of Economics)

We develop methods and employ similar sample restrictions to analyse differences in intergenerational earnings mobility across the United States, the United Kingdom, Denmark, Finland, Norway and Sweden. We examine earnings mobility among pairs of fathers and sons as well as fathers and daughters using both mobility matrices and regression and correlation coefficients. Our results suggest that all countries exhibit substantial earnings persistence across generations, but with statistically significant differences across countries. Mobility is lower in the U.S. than in the U.K., where it is lower again compared to the Nordic countries. Persistence is greatest in the tails of the distributions and tends to be particularly high in the upper tails: though in the U.S. this is reversed with a particularly high likelihood that sons of the poorest fathers will remain in the lowest earnings quintile. This is a challenge to the popular notion of ’American exceptionalism’. The U.S. also differs from the Nordic countries in its very low likelihood that sons of the highest earners will show downward ’long-distance’ mobility into the lowest earnings quintile. In this, the U.K. is more similar to the U.S..

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File URL: http://www.sv.uio.no/econ/english/research/unpublished-works/working-papers/pdf-files/2005/Memo-34-2005.pdf
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Paper provided by Oslo University, Department of Economics in its series Memorandum with number 34/2005.

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Length: 44 pages
Date of creation: 25 Dec 2005
Date of revision:
Handle: RePEc:hhs:osloec:2005_034
Contact details of provider: Postal: Department of Economics, University of Oslo, P.O Box 1095 Blindern, N-0317 Oslo, Norway
Phone: 22 85 51 27
Fax: 22 85 50 35
Web page: http://www.oekonomi.uio.no/indexe.html
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  11. Robert Erikson & John H. Goldthorpe, 2002. "Intergenerational Inequality: A Sociological Perspective," Journal of Economic Perspectives, American Economic Association, vol. 16(3), pages 31-44, Summer.
  12. Bjorklund, Anders & Jantti, Markus, 1997. "Intergenerational Income Mobility in Sweden Compared to the United States," American Economic Review, American Economic Association, vol. 87(5), pages 1009-18, December.
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  17. Lindquist, Matthew J. & Böhlmark, Anders, 2005. "Life-Cycle Variations in the Association between Current and Lifetime Income: Country, Cohort and Gender Comparisons," Working Paper Series 4/2005, Swedish Institute for Social Research.
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  21. Eriksson, Tor & Bratsberg, Bernt & Raaum, Oddbjørn, 2005. "Earnings persistence across generations: Transmission through health?," Memorandum 35/2005, Oslo University, Department of Economics.
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