Intergenerational Correlation of Labour Market Outcomes

Melbourne Institute Working Paper No. 14/09

31 Pages Posted: 20 Jan 2011

See all articles by Nicolas Herault

Nicolas Herault

University of Melbourne - Melbourne Institute: Applied Economic & Social Research

Guyonne R.J. Kalb

University of Melbourne - Melbourne Institute: Applied Economic & Social Research; IZA; ARC Centre of Excellence for Children and Families over the Life Course

Date Written: June 1, 2009

Abstract

This paper focuses on the correlation of labour market outcomes of parents and children and investigates whether education is an important factor in this correlation, allowing for its potential endogeneity. Based on the Household, Income and Labour Dynamics in Australia (HILDA) data, the multivariate analyses show that men’s labour market outcomes are affected by their fathers’ labour market outcomes. The results show no significant intergenerational correlation of labour market outcomes for women when using the proportion of time in unemployment However, there is a significant relationship between the labour market outcomes of the mother and the proportion of time spent out of work by her daughter. Finally, the results show a significant relationship between parents’ and children’s education levels, indicating that there is an indirect effect of parental education on their children’s labour market outcomes through education. Indeed, it is shown that education significantly reduces the proportion of time in unemployment and not in work.

Keywords: labour market outcomes, education, intergenerational correlation, unemployment, labour force participation

JEL Classification: J62, J64, I21

Suggested Citation

Herault, Nicolas and Kalb, Guyonne R.J., Intergenerational Correlation of Labour Market Outcomes (June 1, 2009). Melbourne Institute Working Paper No. 14/09, Available at SSRN: https://ssrn.com/abstract=1628870

Nicolas Herault

University of Melbourne - Melbourne Institute: Applied Economic & Social Research ( email )

Level 5, FBE Building, 111 Barry Street
Parkville, Victoria 3010
Australia

HOME PAGE: http://www.findanexpert.unimelb.edu.au/researcher/person125238.html

Guyonne R.J. Kalb (Contact Author)

University of Melbourne - Melbourne Institute: Applied Economic & Social Research ( email )

Level 5, FBE Building, 111 Barry Street
Parkville, Victoria 3010
Australia

IZA ( email )

P.O. Box 7240
Bonn, D-53072
Germany

ARC Centre of Excellence for Children and Families over the Life Course ( email )

185 Pelham Street
Carlton, 3053
Australia

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