Direct and Indirect Influences of Parental Background on Children's Earnings: A Comparison Across Countries and Genders

28 Pages Posted: 4 Jun 2015

See all articles by Michele Raitano

Michele Raitano

Sapienza University of Rome

Francesco Vona

Observatoire Français des Conjonctures Economiques (OFCE) - Department for Research on Innovation and Competition

Date Written: July 2015

Abstract

The association between parental occupation and children's earnings in eight EU countries is compared using the European Union Survey on Income and Living Conditions (EU‐SILC) data set, analysing: (i) residual background correlations (RBCs) on earnings, controlling for children's education and occupation, and (ii) patterns by gender, controlling for selection into employment. Findings on cross‐country differences confirm well‐known differences in intergenerational income inequality. RBCs are statistically significant irrespective of gender in the UK, Spain and Italy, for men in France and Ireland, for women in Denmark and not significant in Germany and Finland. Not controlling for selection delivers downward biased estimates of RBCs, highlighting the effect of family background on employability.

Suggested Citation

Raitano, Michele and Vona, Francesco, Direct and Indirect Influences of Parental Background on Children's Earnings: A Comparison Across Countries and Genders (July 2015). The Manchester School, Vol. 83, Issue 4, pp. 423-450, 2015. Available at SSRN: https://ssrn.com/abstract=2614196 or http://dx.doi.org/10.1111/manc.12064

Michele Raitano (Contact Author)

Sapienza University of Rome ( email )

Via del Castro Laurenziano 9
Roma, Rome 00161
Italy

HOME PAGE: http://https://sites.google.com/a/uniroma1.it/micheleraitano-eng/

Francesco Vona

Observatoire Français des Conjonctures Economiques (OFCE) - Department for Research on Innovation and Competition ( email )

250 rue Albert Einstein
Valbonne, 06560
France

HOME PAGE: http://www.ofce.sciences-po.fr/ofce/dric.htm

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