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Correlations of Brothers' Earnings and Intergenerational Transmission

Listed author(s):
  • Bingley, Paul

    ()

    (Danish National Centre for Social Research (SFI))

  • Cappellari, Lorenzo

    ()

    (Università Cattolica del Sacro Cuore)

Correlations between parent and child earnings reflect intergenerational mobility and, more broadly, correlations between siblings' earnings reflect shared community and family background. These earnings relationships capture important aspects of relations in socioeconomic status more generally. We estimate intergenerational transmission and sibling correlations of life-cycle earnings jointly within a unified framework that nests previous models. Using data on the Danish population of father/first-son/second-son triads we find that intergenerational effects account for on average 72 percent of sibling correlations. This share is higher than all previous studies because we allow for heterogeneous intergenerational transmission between families. Sibling correlations exhibit a U-shape over the working life, consistent with differences in human capital investments between families.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 10761.

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Length: 47 pages
Date of creation: May 2017
Handle: RePEc:iza:izadps:dp10761
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  1. Björklund, Anders & Roine, Jesper & Waldenström, Daniel, 2012. "Intergenerational top income mobility in Sweden: Capitalist dynasties in the land of equal opportunity?," Journal of Public Economics, Elsevier, vol. 96(5), pages 474-484.
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  21. repec:hrv:faseco:30367426 is not listed on IDEAS
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