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Parental time investment and intergenerational mobility

Listed author(s):
  • Yum, Minchul

This paper investigates parental time investment in children prior to formal schooling as a source of intergenerational income persistence in the U.S. I develop a dynamic general equilibrium model where lifetime income endogenously persists across generations through multiple channels. My model replicates a series of important untargeted aspects of the data including the U.S. income quintile transition matrix. I find that the parental time investment channel accounts for nearly 40 percent of the observed intergenerational income persistence. Policy experiments suggest that e¤ective ways of improving mobility should focus on narrowing discrepancies in the quantity and quality of parental time investments.

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File URL: https://ub-madoc.bib.uni-mannheim.de/40579/1/Yum%2016-06.pdf
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Paper provided by University of Mannheim, Department of Economics in its series Working Papers with number 16-06.

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Date of creation: 2016
Handle: RePEc:mnh:wpaper:40579
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68131 Mannheim

Phone: +49 621 181 1776
Fax: +49 621 181 1774
Web page: http://www2.vwl.uni-mannheim.de/10.1.html
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  20. repec:mpr:mprres:7891 is not listed on IDEAS
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