Nonlinearities in intergenerational earnings mobility : consequences for cross-country comparisons
Bratsberg, Bernt , Røed, Knut , Raaum, Oddbjørn , Naylor, Robin Andrew, 1959-, Jäntti, Markus , Eriksson, Tor and Österbacka, Eva (2006) Nonlinearities in intergenerational earnings mobility : consequences for cross-country comparisons. Working Paper. Coventry: University of Warwick, Department of Economics. (Warwick economic research papers).
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We show that the patterns of intergenerational earnings mobility in Denmark, Finland, and Norway, unlike those for the US and the UK, are highly nonlinear. The Nordic relationship between log earnings of sons and fathers is flat in the lower segments of the fathers’ earnings distribution – sons growing up in the poorest households have the same adult earnings prospects as sons in moderately poor households – and is increasingly positive in middle and upper segments. This convex pattern contrasts sharply with our findings for the United States and the United Kingdom, where the relationship is much closer to being linear. As a result, cross-country comparisons of intergenerational earnings elasticities may be misleading with respect to transmission mechanisms in the central parts of the earnings distribution, and uninformative in the tails of the distribution.
|Item Type:||Working or Discussion Paper (Working Paper)|
|Subjects:||H Social Sciences > HD Industries. Land use. Labor|
|Divisions:||Faculty of Social Sciences > Economics|
|Library of Congress Subject Headings (LCSH):||Occupational mobility, Wages, Intergenerational relations|
|Series Name:||Warwick economic research papers|
|Publisher:||University of Warwick, Department of Economics|
|Place of Publication:||Coventry|
|Date:||27 September 2006|
|Number of Pages:||35|
|Institution:||University of Warwick|
|Access rights to Published version:||Open Access|
|Funder:||Nordic Council of Ministers (NCM), Suomen Akatemia [Academy of Finland], Norwegian Ministry of Labour and Social Inclusion (NMLSI)|
|Grant number:||NCM project no. 149813- 599, AF project no. 206680, NMLSI Frisch project no. 1391.|
|Version or Related Resource:||Bratsberg, B., et al. (2006). Nonlinearities in intergenerational earnings mobility: consequences for cross-country comparisons. Economic Journal, 117(519), pp.C72-92.|
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