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What More Than Parental Income? An Exploration of What Swedish Siblings Get from Their Parents

Author

Listed:
  • Björklund, Anders

    () (SOFI, Stockholm University)

  • Lindahl, Lena

    () (SOFI, Stockholm University)

  • Lindquist, Matthew J.

    () (SOFI, Stockholm University)

Abstract

Sibling correlations are used as overall measures of the impact of family background and community influences on individual outcomes. While most correlation studies show that siblings are quite similar in terms of future achievement, we lack specific knowledge of what it is about family background that really matters. Studies on intergenerational income mobility show that parental income matters to some extent, but they also show that more than half of the family background and community influences that siblings share are not even correlated with parental income. In this paper, we employ a data set that contains rich information about families in order to explore what factors in addition to parental income can explain why siblings tend to have such similar outcomes. Our results show that measures of family structure and social problems account for very little of sibling similarities in adult income above and beyond that already accounted for by parental income. However, when we add a set of indicators for parental involvement and attitudes, the explanatory power of all our variables increased from about a third (using only traditional indicators of socio-economic status) to just over half. Interestingly, indicators of parents' patience, i.e., propensity to plan ahead and willingness to postpone benefits to the future, are particularly important.

Suggested Citation

  • Björklund, Anders & Lindahl, Lena & Lindquist, Matthew J., 2008. "What More Than Parental Income? An Exploration of What Swedish Siblings Get from Their Parents," IZA Discussion Papers 3735, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp3735
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    References listed on IDEAS

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    1. Hjalmarsson, Randi & Lindquist, Matthew, 2009. "Like Godfather, Like Son: Explaining the Intergenerational Nature of Crime," Research Papers in Economics 2009:18, Stockholm University, Department of Economics.
    2. Anders Bohlmark & Matthew J. Lindquist, 2006. "Life-Cycle Variations in the Association between Current and Lifetime Income: Replication and Extension for Sweden," Journal of Labor Economics, University of Chicago Press, vol. 24(4), pages 879-900, October.
    3. Anders Björklund & Marianne Sundström, 2006. "Parental Separation and Children's Educational Attainment: A Siblings Analysis on Swedish Register Data," Economica, London School of Economics and Political Science, vol. 73(292), pages 605-624, November.
    4. 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.
    5. Markus Jäntti & Eva Österbacka & Oddbjörn Raaum & Tor Eriksson & Anders Björklund, 2002. "Brother correlations in earnings in Denmark, Finland, Norway and Sweden compared to the United States," Journal of Population Economics, Springer;European Society for Population Economics, vol. 15(4), pages 757-772.
    6. Mason, Patrick, 2007. "Intergenerational mobility and interraical inequality:the return to family values," MPRA Paper 11327, University Library of Munich, Germany.
    7. François Bourguignon & Francisco H. G. Ferreira & Marta Menéndez, 2007. "Inequality Of Opportunity In Brazil," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 53(4), pages 585-618, December.
    8. Gary Solon & Marianne E. Page & Greg J. Duncan, 2000. "Correlations Between Neighboring Children In Their Subsequent Educational Attainment," The Review of Economics and Statistics, MIT Press, vol. 82(3), pages 383-392, August.
    9. Oddbjørn Raaum & Kjell G. Salvanes & Erik O. Sørensen, 2006. "The Neighbourhood is Not What it Used to be," Economic Journal, Royal Economic Society, vol. 116(508), pages 200-222, January.
    10. Bhashkar Mazumder, 2008. "Sibling similarities and economic inequality in the US," Journal of Population Economics, Springer;European Society for Population Economics, vol. 21(3), pages 685-701, July.
    11. Thomas Dohmen & Armin Falk & David Huffman & Uwe Sunde, 2012. "The Intergenerational Transmission of Risk and Trust Attitudes," Review of Economic Studies, Oxford University Press, vol. 79(2), pages 645-677.
    12. Björklund, Anders & Jäntti, Markus & Lindquist, Matthew J., 2009. "Family background and income during the rise of the welfare state: Brother correlations in income for Swedish men born 1932-1968," Journal of Public Economics, Elsevier, vol. 93(5-6), pages 671-680, June.
    13. Marianne E. Page & Gary Solon, 2003. "Correlations between Brothers and Neighboring Boys in Their Adult Earnings: The Importance of Being Urban," Journal of Labor Economics, University of Chicago Press, vol. 21(4), pages 831-856, October.
    14. Marianne E. Page & Gary Solon, 2003. "Correlations between sisters and neighbouring girls in their subsequent income as adults," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 18(5), pages 545-562.
    15. Roland G. Fryer & Steven D. Levitt, 2004. "Understanding the Black-White Test Score Gap in the First Two Years of School," The Review of Economics and Statistics, MIT Press, vol. 86(2), pages 447-464, May.
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    Cited by:

    1. Björklund Anders & Hederos Eriksson Karin & Jäntti Markus, 2010. "IQ and Family Background: Are Associations Strong or Weak?," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 10(1), pages 1-14, January.
    2. René Böheim & Christina Judmayr, 2014. "Bildungs- und Einkommenskorrelationen von Geschwistern in Österreich," Wirtschaft und Gesellschaft - WuG, Kammer für Arbeiter und Angestellte für Wien, Abteilung Wirtschaftswissenschaft und Statistik, vol. 40(4), pages 531-557.
    3. John Ermisch & Chiara Pronzato, 2010. "Causal Effects of Parents’ Education on Children’s Education," CHILD Working Papers wp05_10, CHILD - Centre for Household, Income, Labour and Demographic economics - ITALY.

    More about this item

    Keywords

    parents; intergenerational mobility; siblings; family background; long-run income;

    JEL classification:

    • D1 - Microeconomics - - Household Behavior
    • D3 - Microeconomics - - Distribution
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion

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