Intergenerational Mobility and the Process of Development

Posted: 17 Sep 2002

See all articles by Yishay Maoz

Yishay Maoz

The Open University of Israel - Department of Management and Economics

Omer Moav

University of Warwick - Department of Economics; Centre for Economic Policy Research (CEPR)

Abstract

This paper offers an explanation for some evidence that intergenerational earnings mobility is higher in more developed economies and that mobility is positively correlated with wage equality. In the model mobility promotes economic growth via its effect on the accumulation and allocation of human capital. Growth influences mobility via its effect on incentives to acquire education and its effect on liquidity constraints upon such acquisition. In the process of development mobility increases and the distribution of education becomes better correlated with ability. Redistributive policy has a negative effect on growth in developed economies and a positive effect in developing economies.

Keywords: Intergenerational Income Mobility, Inequality, Growth, Human Capital

JEL Classification: D31, J31, J62 , O40

Suggested Citation

Maoz, Yishay and Moav, Omer, Intergenerational Mobility and the Process of Development. The Economic Journal, Vol. 109, October 1999, pp. 677-697. Available at SSRN: https://ssrn.com/abstract=326121

Yishay Maoz

The Open University of Israel - Department of Management and Economics ( email )

1 University Road
Raanana, 43107
Israel
9727781891 (Phone)
97297780668 (Fax)

HOME PAGE: http://www.openu.ac.il/Personal_sites/Yishay-Maoz.html

Omer Moav (Contact Author)

University of Warwick - Department of Economics ( email )

Coventry CV4 7AL
United Kingdom

HOME PAGE: http://www2.warwick.ac.uk/fac/soc/economics/staff/academic/moav

Centre for Economic Policy Research (CEPR)

London
United Kingdom

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