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Brother Correlations in Earnings in Denmark, Finland, Norway and Sweden Compared to the United States

  • Björklund, Anders

    ()

    (SOFI, Stockholm University)

  • Eriksson, Tor

    ()

    (Aarhus School of Business)

  • Jäntti, Markus

    ()

    (SOFI, Stockholm University)

  • Raaum, Oddbjørn

    ()

    (Ragnar Frisch Centre for Economic Research)

  • Österbacka, Eva

    ()

    (Abo Akademi University)

The correlation in economic status among siblings is a useful "omnibus measure" of the overall impact of family and community factors on adult economic status. In this study we compare brother correlations in long-run (permanent) earnings between the United States, on one hand, and the Nordic countries (Denmark, Finland, Norway and Sweden) on the other. Our base case results, based on very similar sample criteria and definitions for all countries, show that this correlation is above 0.40 in the United States and in the range 0.15-0.28 in the Nordic countries. Even though these results turn out to be somewhat sensitive to some assumptions that have to be made, we conclude that the family and community factors are more important determinants of long-run earnings in the United States than in the Nordic countries.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 158.

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Length: 31 pages
Date of creation: May 2000
Date of revision:
Publication status: published in: Journal of Population Economics, 15 (4), 2002, 757-772; see IZA Reprints 163/03
Handle: RePEc:iza:izadps:dp158
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  1. 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.
  2. Solon, Gary, 1999. "Intergenerational mobility in the labor market," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 29, pages 1761-1800 Elsevier.
  3. Joseph G. Altonji & Thomas A. Dunn, 1991. "Relationships Among the Family Incomes and Labor Market Outcomes of Relatives," NBER Working Papers 3724, National Bureau of Economic Research, Inc.
  4. Richard B. Freeman & Lawrence F. Katz, 1995. "Differences and Changes in Wage Structures," NBER Books, National Bureau of Economic Research, Inc, number free95-1.
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