Intergenerational Mobility Under Private vs. Public Education

19 Pages Posted: 29 Dec 2005

See all articles by James B. Davies

James B. Davies

University of Western Ontario - Department of Economics; CESifo (Center for Economic Studies and Ifo Institute)

Jinli Zeng

National University of Singapore (NUS) - Department of Economics

Jie Zhang

National University of Singapore (NUS); University of Queensland

Abstract

Intergenerational earnings mobility is analyzed in a model where human capital is produced using schooling and parental time. In steady states more mobile societies have less inequality, but in the short run higher mobility may result from an increase in inequality. Starting from the same inequality, mobility is higher under public than under private education. A rise in income shocks, for example due to increased returns to ability, or a switch from public to private schooling both increase inequality. However, increased shocks raise mobility in the short run and do not affect it in the long run, whereas an increased role for private schooling reduces mobility in both the short and long run. That these differences may help to identify the source of changes in inequality, and other real-world implications, are illustrated in a brief discussion of time trends and cross-country differences.

Keywords: Mobility, inequality, education regimes

JEL Classification: J62, D30, I20

Suggested Citation

Davies, James and Zeng, Jinli and Zhang, Jie, Intergenerational Mobility Under Private vs. Public Education. Scandinavian Journal of Economics, Vol. 107, No. 3, pp. 399-417, September 2005, Available at SSRN: https://ssrn.com/abstract=857804 or http://dx.doi.org/10.1111/j.1467-9442.2005.00415.x

James Davies (Contact Author)

University of Western Ontario - Department of Economics ( email )

1151 Richmond Street
Suite 2
London, Ontario N6A 5B8
Canada

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

Jinli Zeng

National University of Singapore (NUS) - Department of Economics ( email )

1 Arts Link, AS2 #06-02
Singapore 117570, Singapore 119077
Singapore

Jie Zhang

National University of Singapore (NUS) ( email )

1E Kent Ridge Road
NUHS Tower Block Level 7
Singapore, 119228
Singapore

University of Queensland ( email )

St Lucia
Brisbane, Queensland 4072
Australia

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