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Intergenerational Mobility under Private vs. Public Education

  • James B. Davies

    (University of Western Ontario)

  • Jie Zhang

    (University of Queensland)

  • Jinli Zeng

    (National University of Singapore)

This paper analyzes intergenerational earnings mobility in a model where human capital is produced using schooling and parental time. In steady -states more mobile societies have less inequality, but in the short-run higher mobility may result from an increase in inequality. Starting from the same inequality, mobility is higher under public than under private education. A rise in income shocks, for example due to increased returns to ability, or a switch from public to private schooling both increase inequality. However, increased shocks raise mobility in the short-run and do not affect it in the long-run, whereas an increased role for private schooling reduces mobility in both the short- and long-run. That these differences may help to identify the source of changes in inequality, and other real-world implications, are illustrated in a brief discussion of time trends and cross-country differences.

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File URL: http://www.fas.nus.edu.sg/ecs/pub/wp/wp0313.pdf
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Paper provided by National University of Singapore, Department of Economics in its series Departmental Working Papers with number wp0313.

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Length: 24 pages
Date of creation: Jan 2003
Date of revision:
Handle: RePEc:nus:nusewp:wp0313
Contact details of provider: Web page: http://www.fas.nus.edu.sg/ecs/index.html

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