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Trends in Absolute Income Mobility in North America and Europe

Author

Listed:
  • Manduca, Robert

    (University of Michigan)

  • Hell, Maximilian

    (Stanford University)

  • Adermon, Adrian

    (IFAU)

  • Blanden, Jo

    (University of Surrey)

  • Bratberg, Espen

    (University of Bergen)

  • Gielen, Anne C.

    (Erasmus University Rotterdam)

  • van Kippersluis, Hans

    (Erasmus University Rotterdam)

  • Lee, Keun Bok

    (California State University)

  • Machin, Stephen

    (London School of Economics)

  • Munk, Martin D.

    (Aalborg University)

  • Nybom, Martin

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

  • Ostrovsky, Yuri

    (Statistics Canada)

  • Rahman, Sumaiya

    (Frontier Economics)

  • Sirniö, Outi

    (University of Turku)

Abstract

We compute rates of absolute upward income mobility for the 1960-1987 birth cohorts in eight countries in North America and Europe. Rates and trends in absolute mobility varied dramatically across countries during this period: the US and Canada saw upward mobility rates near 50% for recent cohorts, while countries like Norway and Finland saw sustained rates above 70%. Decomposition analysis suggests that differences in the marginal income distributions, especially the amount of cross-cohort income inequality, were the primary driver of differing mobility rates across countries. We also demonstrate that absolute mobility rates can be accurately estimated without linked parent-child data.

Suggested Citation

  • Manduca, Robert & Hell, Maximilian & Adermon, Adrian & Blanden, Jo & Bratberg, Espen & Gielen, Anne C. & van Kippersluis, Hans & Lee, Keun Bok & Machin, Stephen & Munk, Martin D. & Nybom, Martin & Ost, 2020. "Trends in Absolute Income Mobility in North America and Europe," IZA Discussion Papers 13456, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp13456
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    References listed on IDEAS

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    1. Claudia Olivetti & Barbara Petrongolo, 2017. "The Economic Consequences of Family Policies: Lessons from a Century of Legislation in High-Income Countries," Journal of Economic Perspectives, American Economic Association, vol. 31(1), pages 205-230, Winter.
    2. Thomas Blanchet & Juliette Fournier & Thomas Piketty, 2022. "Generalized Pareto Curves: Theory and Applications," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 68(1), pages 263-288, March.
    3. Yonatan Berman, 2022. "The Long-Run Evolution of Absolute Intergenerational Mobility," American Economic Journal: Applied Economics, American Economic Association, vol. 14(3), pages 61-83, July.
    4. Hilary Hoynes & Douglas L. Miller & Jessamyn Schaller, 2012. "Who Suffers during Recessions?," Journal of Economic Perspectives, American Economic Association, vol. 26(3), pages 27-48, Summer.
    5. Claudia Olivetti & Barbara Petrongolo, 2017. "The Economic Consequences of Family Policies: Lessons from a Century of Legislation," Working Papers 811, Queen Mary University of London, School of Economics and Finance.
    6. Claudia Olivetti & Barbara Petrongolo, 2017. "The Economic Consequences of Family Policies: Lessons from a Century of Legislation in High-Income Countries," Journal of Economic Perspectives, American Economic Association, vol. 31(1), pages 205-230, Winter.
    7. Raj Chetty & Nathaniel Hendren & Patrick Kline & Emmanuel Saez, 2014. "Where is the land of Opportunity? The Geography of Intergenerational Mobility in the United States," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 129(4), pages 1553-1623.
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    Cited by:

    1. Tomas Kennedy & Peter Siminski, 2022. "Are We Richer than Our Parents Were? Absolute Income Mobility in Australia," The Economic Record, The Economic Society of Australia, vol. 98(320), pages 22-41, March.
    2. Yonatan Berman, 2022. "Absolute intragenerational mobility in the United States, 1962–2014," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 20(3), pages 587-609, September.
    3. Sadegh Eshaghnia & James J. Heckman & Rasmus Landersø & Rafeh Qureshi, 2022. "Intergenerational Transmission of Family Influence," NBER Working Papers 30412, National Bureau of Economic Research, Inc.

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    More about this item

    Keywords

    absolute intergenerational mobility; income; international comparison;
    All these keywords.

    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
    • P52 - Political Economy and Comparative Economic Systems - - Comparative Economic Systems - - - Comparative Studies of Particular Economies

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