The Intergenerational Persistence of Human Capital: An Empirical Analysis of Four Generations
University of Bonn; Institute for the Study of Labor (IZA)
Stockholm School of Economics - Department of Economic Statistics; Institute for the Study of Labor (IZA)
Sofia Sandgren Massih
affiliation not provided to SSRN
IFAU - Institute for Labour Market Policy Evaluation; Stockholm University - Swedish Institute for Social Research (SOFI)
IZA Discussion Paper No. 6463
Most previous studies of intergenerational transmission of human capital are restricted to two generations – parents and their children. In this study we use a Swedish data set which enables us link individual measures of lifetime earnings for three generations and data on educational attainments of four generations. We investigate to what extent estimates based on income data from two generations accurately predicts earnings persistence beyond two generations. We also do a similar analysis for intergenerational persistence in educational attainments. We find two-generation studies to severely under-predict intergenerational persistence in earnings and educational attainment over three generations. Finally, we use our multigenerational data on educational attainment to estimate the structural parameters in the Becker-Tomes model. Our results suggest a small or no causal effect of parental education on children's educational attainment.
Number of Pages in PDF File: 34
Keywords: multigenerational income mobility, human capital transmission, intergenerational income mobility
JEL Classification: D31, J62
Date posted: April 14, 2012
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